92 VARIETIES OF CAPITALISM AND THE IMPACT OF THE GLOBAL ECONOMIC CRISIS ON INTERNATIONAL BUSINESS Tatiana Kostova, Ph.D. Sonoco International Business Department Moore School of Business University of South Carolina 1705 College Street Columbia, SC 29208 Tel. (803) 777-3553 kostova@sc.edu Stoyan Tenev, Ph.D. Independent Evaluation Group International Finance Corporation The World Bank Group 1818 H Street, N. W., MSN H3-305 Washington, D.C. 20433 Tel. (202) 458-4497 stenev@ifc.org Abstract The paper examines the impact of the global economic crisis on international business. In particular, we illustrate the negative impact on international business activities such as international trade and foreign direct investment, which we view as short term effects. The long term effects of the crisis relate to the conditions for international business including the decrease in economic freedom and growing corruption across countries and regions. While the crisis has spread throughout the world economy and has affected every single country, our research shows that countries differ with regard to their response to the crisis. Various models of capitalism are associated with different strategic