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Political factors are government related influences on the strategies of businesses and other organizations. This includes political processes such as protests and elections that can create uncertainty and disruptions. The following are common examples of political factors.
Business Regulations | Competition Laws | Consumer Protection | Corruption | Cronyism | Declarations of Emergency (e.g. forced shutdown of private businesses) | Elections | Environmental Regulations | Funding Grants | Government Interventions in Markets | Government Shutdowns | Government Spending | Government Stability | Immigration Policy (e.g. ability to hire foreign talent) | Infrastructure Policy | International Disputes | Labor Law | Non-tariff Trade Barriers | Permits & Licenses | Political Stability | Protests | Red Tape | Regional Stability | Rights & Freedoms | Safety & Security | Strike Actions | Subsidies | Tariffs | Taxation | War & Conflict |
Political Factors in BusinessPolitical factors have a significant impact on business. Some factors such as low taxes are broadly stimulative for all businesses. It is also common for political factors to be negative for one business but positive for another. For example, an ecommerce site that booms during a government shutdown of physical retail locations. Likewise things like red tape can be mostly negative for business but some businesses may view burdensome regulations as a positive because it prevents new competitors from entering their market. The following are common political factors in business.International Factors in BusinessThe actions of foreign governments and general political conditions in other countries can also impact your business. This includes large scale events such as war, conflict, trade disputes or government instability. International factors can also include compliance costs, trade obstructions or unfair advantages given to foreign competitors by their governments.Secondary ImpactsPolitical factors have secondary impacts. In particular, economic factors are largely shaped by political processes. For example, governments can greatly influence things like credit conditions, exchange rates and interest rates that have a massive impact on the economy.Impacts vs RisksPolitical factors can include the current state of politics and political risks that are the potential for future impacts.Next: Social Factors
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