Multinational Corporations Play A Important Role Of The International Economy

Typically, a multinational corporation develops new products in its native country and manufactures them abroad, often in Third World nations, thus gaining trade advantages and economies of labor and materials. Almost all the largest multinational firms are American, Japanese, or West European. Such corporations have had worldwide influence—over other business entities and even over governments, many of which have imposed controls on them. During the last

Multinational corporations are organizations that work in numerous nations. They likewise help to keep up the worldwide predominance of the Industrialized Nations just by working together sustaining universal stratification. MNC may have a few premiums like overseeing mining operations in a few nations, fabricating merchandise in others, and market its items around the world. The essential recipients are dependably the Industrialized countries, particularly the one in which the multinational partnership has its reality home office. In their quest for benefits, the multinational corporations require helpful power elites at all industrialized countries. The MNC dependably require positive business atmosphere in type of low

Supporters of Transnational Corporations (TNC) say that their operation in “third world” country, also known as a “developing country”, benefits both the home country (where the TNC is based) and the host country (where they operate). TNCs construct facilities, make infrastructure improvements, and employ local people, all activities that should improve the economy of a host nation. Many host nations hope that there will be a multiplier effect from the direct investment by a transnational corporation, known as foreign direct investment, or FDI. That multiplier is expected to ripple across all other sectors of their economy – benefitting everyone.

I partially agree with this thesis. Just because MNCs are capable of changing a country, they have no obligation to do so. It is not their moral responsibility to do so either. Although they should support just background institutions, they do not have to.

While I'm no fan of multinationals in general, there are exceptions that need to be considered. One example of a multinational entity that truly benefits a peripheral nation is the luthier Robert Rey of Olympia, Washington (Luthiers are instrument builders, in this case Rob focuses on making violins and bows). Rather than having goods made in sweatshops, he has developed a relationship with luthiers in Beijing that run shoppes similar to his. He pays them to make celli and bows for him (Rey, Rob. personal communication 2016); which he can sell at low prices due to the disparity of the economies of China

Businesses need to expand internationally to remain competitive. Globalization has come to encompass everything from "factories shifting around" to "international bodies that set the rules for the global economy." It has resulted in the outsourcing of jobs to less-developed nations. In the United States, jobs in manufacturing are being outsourced to China and India. In a USA Today poll in 2004, 68 percent of Americans felt outsourcing of jobs was bad for the economy. (Carroll and Buchholtz, 2006:293)Companies from banks to pharmaceuticals operate and compete in a global environment. When MNCs start work in another country, they must fulfil their social responsibilities in order to be perceived as legitimate. MNCs are caught in dilemmas. For example, if it were to repatriate a large part of its profits, it would be seen as depriving the host country of wealth. If it were to invest profits locally, it may be perceived to be tightening its control on the host country's economy. Pay is another sensitive issue. MNCs seem to be exploiting labour with its low wages. However, if it were to pay more to its employees, local businesses would be hurt in the long run. (Carroll and Buchholtz, 2006: 297-300)MNCs may also be assailed for not adhering to standards from their

Multinational corporations are companies that have branches and operations in two or more countries. These companies are the main results of globalization, since they operate all over the world as if it was one country. Multinational corporations have a home country which contain their headquarters and offices for management and have host countries in which their operations take place. The home countries of multinational corporations are usually developed countries that have great capitals and the host countries are developing countries due to the low costs of labor, raw materials, and taxes paid to the governments.

Over the years, Multinational enterprise have matured and developed into large companies that they are now part of our everyday lives. Form the use of mobile phones to the cars, personal computers and their software and even the beverage we drink, most of these products are supplied by Multinational companies. Their existence has great impact on our lives. In the world today, Multinational enterprises are powerful companies and they own resources in excess that most host countries possess. These companies are so powerful that they turn out to be power centers that can manipulate the host countries and even international organizations and at times the affairs in its home country.

The rise of the corporation follows the path of the rise of Western capitalist society. When industrial societies expanded, the birth of many corporations formed to consolidate power, market share and ultimately, profit. In the last century, the emergence of large multinational corporations (MNC)* has brought both benefits and numerous problems to our global society. The documentary film The Corporation has left an indelible mark on my perception on how globalization has affected poor countries. The film provides a critical review on the rise of MNC and its current corporate practices. The study of multinational corporations have led to the emergence of several academic approaches that question the merits and consequences of globalization.

INCREASE IN EMPLOYMENT- MNC entering into any developing nation comes with best thing i.e. creating the maximum employment. Cost effective labour in host countries is two ways beneficial parameter for both

Why MNCs are important for the world and what are the conflicts that MNCs can solve?

Multinationals are being accused of exploiting the resources and workforce of third world countries. Agricultural businesses take the best lands for harvesting the export crops which lessens the amount of good land that the locals can use for their own food needs. Hazardous chemical industries and drug industries misuse the slack safety laws and cause huge disasters. Developed countries are depleting the natural resources of developing countries. Developing countries have natural resources and developed countries have the technology. They make use of the natural resources of the developing countries while at the same time preserving their own natural resources for future (Ferrell, Fraedrich, & Ferrell, 2011). Manufacturing and service industries are bringing more and more poverty in third world countries. They hire more and more labors more than their requirement. They pay them very less amount.

“Tell me, is there some society that doesn’t run on greed? What is greed? Of course, none of us are greedy, it is only the other fellow that’s greedy. The world runs on individuals pursuing their separate interests.” - Milton Friedman (2002)

The study of the internationalisation of emerging market multinationals (EMNCs) has gained prominence in the last two decades, as a result of increased internationalisation of firms from emerging markets (EM). These internationalisation phenomena have resulted in a surge of interest from international business (IB) scholars (Cavusgil,1980; Hoskisson, Eden, Lau, & Wright, 2000; Jormanainen & Koveshnikov, 2012). This surge in EMNCs internationalisation is due to the economic growth and transformation witnessed among the emerging markets (EM) in the same period. A critical observation of extant literature shows however, that multinationals from Asia and Latin America has dominated the study of EMNCs internationalisation (Child and Rodriguez, 2005; Yeoh, 2011; Fortanier & Tulder, 2009; Sim, 2005,). Others include that of Olaya, Olaya and Cueter (2012) of 5 Latin American countries, while, Cyrino, Barcellos & Tanure (2010) study Brazil, Eren-Erdogmus, Cobanoglu, Yalcın & Ghauri (2010) study Turkish retail firms and Bianchi, (2014) that of Chilean firms. While some Sub-Saharan Africa (SSA) firms have also emerged as high profile multinationals and internationalising. Research on Sub-Saharan Africa emerging market firms from countries such as Nigeria, Kenya and South African, Angola and Ghana are lacking in the internationalisation business research and policy debate (Adeleye, White, & Boso, 2016).

Thus, the multinational corporation is intrinsically a force for progress in the sense that its very existence participates in the maximisation of profits by eliminating or reducing the harmful effects of market imperfections. Internalisation theory, and other mainstream theories of the multinational firm such as eclectic theory are useful in this analysis since they establish the nature of MNCs as behaving in a way that is the most efficient, and thus beneficial to them. If we accept that firms are beneficial to the world in that they create wealth, then MNCs are a force for progress. However, the buck stops here for these theories. Although they provide insight into the nature and behaviour of firms, mainstream theories of economics and international business do not provide any analysis of the consequences firms’ behaviour has on less developed countries (LDCs) and the world order . As we expand our definition of progress, or the field of the visible in terms of the harm that MNCs can cause, then a different picture is painted.