The benefits and harm caused by Transnational Companies.
Essay Practice “TNCs bring more benefits than harm to host countries”. To what extent do you agree with this statement? TNCs, or Transnational Companies, refer to large global companies which operate worldwide productions with different functions taking place where it is the most profitable. Over the past decades, globalization has resulted in major technological advancements in transport such as containerization and cargo ships, as well as rapid developments in communications such as the internet. This has brought about the dramatic increase in size of and numbers of TNCs. As more TNCs are being set up in other countries, there have been incidences of both positive and negative impacts on the host countries, which are the countries which the TNCs are present in because of the international agreement between the TNC and the country involved. Over time, it has been noticed that host countries do benefit from TNCs, and these impacts include a more guaranteed income for the local workforce and boosting of the local economy. At the same time, as problems such as exploitation of workers surface, it appears that TNCs bring more harm than benefits to these host countries. When TNCs set up their firms in the host country, they create job opportunities for the population, hence with a stable job; the local workforce receives a guaranteed income. For TNCs which were situated in
Multinational Corporations in context
Multinational Corporations in context When we mention MNCs, we instantly concern ourselves with firms such as McDonalds, Coca-cola and Nike. However, there are plenty more of these firms in the international market, which are also known as TNCs. Some are often puzzled by the ultimate definition which is still facing small-scale controversy, 'enterprise operating in several countries via assets or production facilities where the firm has 25% or more of its output capacity located outside its country of origin'. It often occurs that several of these MNCs' budgets are so great that they exceed the GDP of several countries. The world's largest multinational in 2000, was Exxon Mobil which has a value greater than the GDP of Pakistan whilst the joint revenues of the four largest MNCs outweighed the combined gross national product of all African countries. The budgets raised by MNCs across the world are so great that they influence many newly industrialized and less economically developed countries. In a highly competitive world, companies seek to reduce their costs as much as possible and therefore the prospect of a foreign company setting up in a country where labour is cheap is attractive for both the company and the host country's government. These influences can be both good and bad but what are the specific motives for MNCs existing and are there any particular examples? The
Advantages and Disadvantages of the Rise in Corporations
Advantages and Disadvantages of the Rise in Corporations Today we know that corporations, for good or bad, are major influences on our lives. They have essentially become a part of our lifestyle. These multi-national companies based around the world started through the industrial revolution, which was a period in history when people found new and efficient ways of producing goods, manufacturing services and creating new methods of transportation. This lead to exploitation of these corporations such as: child labour, low wages, poor working conditions and long working hours. Nike and Gap have been criticized for their workers in their worldwide sweatshops. The Global Exchange found workers hunch over sewing machines, kept awake by forced intoxicating drugs on 72-hour shifts. Child laborers worked in sub-standard health conditions, receiving pay far below minimum wage in factories that distribute to mainstream clothing retailers. Poor and desperate people work behind the closed doors of sweatshops where verbal, physical and sexual abuse is common. As a result of this, trade unions formed. Their purpose was to protect and improve people's pay and conditions of employment. They also campaigned for laws and policies which will benefit working people. Trade unions exist because an individual worker has very little power to influence decisions that are made about his or
The e-Learning market for corporations.
e-Learning Delivery Solutions Industry analysis Company analysis - Centra software Inc High Technology, Entrepreneurship and Strategy Professor Ron Adner Students Uri Einan Vinod Janardhan Rajat Nag Yaron Spigel Adrian Horotan Fontainebleau June 2001 Table of contents Part I - Industry analysis 1. Introduction 1 2. The size of the eLearning market 3 3. Definitions 5 4. Market segmentation 6 4.1 content 4.2 services 4.3 technology 5. The SCEL platforms market 8 6. Market drivers 10 7. The future of elearning 11 8. Conclusion 13 Part II - Company Analysis - Centra software Inc. 1. Preface 14 2. Company background 15 3. Product 17 4. Value chain 21 4.1 Suppliers 4.2 Customers 5. Partnerships 23 6. Competition 25 6.1 Interwise 6.2 IBM/Lotus 6.3 Mentergy 6.4 Microsoft 6.5 ACEL platform companies 6.6 LMS companies 6.7 Content providers and Service providers 7. Competitive advantages and strategy analysis 33 Appendices 39 Appendix I Comparison of C-learning with Elearning Appendix II Customers Appendix III Partnerships Bibliography Part I - Market Analysis . Introduction - The e-Learning market The landscape of learning has never looked more promising for companies in the education business. Education is the second largest market in the
Assess the extent to which Trans National Corporations (TNCs) have a positive impact on both developed and developing countries. (15 marks)
Assess the extent to which TNC's have a positive impact on both developed and developing countries. (15 marks) As we know the movement of globalization is very important in today's way of life. It affects many different aspects, including culture, economy, and environment also some demographic, political and technological issues. It helps to promote connection, remove barriers and most of all encourage global movement. Globalization creates a greater exchange of ideas, resulting in more knowledge gained about other cultures, also new trade opportunities, of products which were not available in the past. Trans National Corporations (TNC's) are companies which operate in more than one country. The largest firms have branch plants in many different countries. An example of a TNC is McDonalds; it has nearly 30,000 restaurants in 119 countries. Trans National Corporations grow and develop by buying foreign firms, expansion (popularity) and by broadening their product range. As TNC's operate worldwide they affect many different people in every stage of their function. The social side of the effects creates by the function of TNC's is great, as the companies are making money, there are many other factors which are also affected. One of the main impacts TNC's have on both developed (MEDC) and developing (LEDC) countries, is the exchange of ideas and knowledge from different
Many examples of Companies working globally are: Nike, Adidas and other companies which may not necessarily be in the clothing business. These are usually referred to as TNC's or transnational companies
The logo: Good or Bad Written and edited by Jai Malhi We are all conscious of what we buy, but do we really know the effects of buying these goods. There has always been the debate of whether we are doing harm to ourselves and others when buying expensive designer goods with the popular 'logo'. Branded goods are goods, often known to us as the clothing we wear, which bear a company name or trademark and are often expensive and considered to have an extra mark of prestige. There are various different goods like clothing, which are made globally which is a subject I will cover later, and they are worldwide recognised names on the clothes we buy for example; Adidas and Prada which are known all over the world and the process it goes through to finally reach the buyer is often a hassle to many. The question though is whether the logo really matters. Should we all be drawn into buying the branded goods and not bother to find out what it does to others? You may be thinking that harming others through buying expensive branded goods is not possible, but there is one way; Globalisation. TNC's also plays a large part in globalisation. A TNC is a transnational company. (c) Here are some easily recognisable transnational companies. (Top left: Nike, Top right: Coca Cola, Below: Mc Donalds.) If you still do not understand what a TNC is maybe this will help. A TNC is a
Nowadays multinational corporations have three main alternatives to realize international entry. Globalization.
Nowadays multinational corporations have three main alternatives to realize international entry. They are foreign direct investment, exporting and licensing. With the process of globalization, more and more multinational corporations adopt foreign direct investment. "Foreign direct investment occurs when a firm invests directly in facilities to produce and/or market a product in a foreign country." (Hill, 2002) At present, foreign direct investment plays an important role in the world economics; the growth of FDI is even faster than world trade and world output. The statistic figure shows that the growth of FDI, world trade and world output is more than 900 percent, 121 percent and 34 percent respectively between 1984 and 1998. (Data source: World Trade Organization, Annual Report, 1998). Although the developed countries have occupied the main position of the growth of FDI, FDI also grows quickly in some developing countries. "From 1985 to 1990, the annual inflow of FDI into developing nations averaged $27.4 billion, or 17.4 percent of the total global flow. By1997, the inflow into developing nations had risen to $149billion,or 37 percent of the total" (Hill,2002). From my point of view, the main motives of multinational corporations to adopt FDI are involved in four aspects: cost, market, taxation and risk. ? Cost FDI can reduce operative cost in the field of labour,
Assess the view that the main cause of globalization is the increased significance of transnational companies. What are the costs and benefits?
Assess the view that the main cause of globalisation is the increased significance of transnational companies? Globalisation is the process by which the world’s economies become more closely integrated and interdependent. Globalisation has increased significantly over the past 50 years due to a number of factors. The increased significance of transnational companies, which are companies that are based in different countries i.e. have offices in various different parts of the world, has had an impact on increasing globalisation. As the companies have various offices and production points around the world it means that the world’s economies are becoming more interdependent. For example a car making firm may have its assembling parts in one country but it may have been designed in another country. This means that the process and parts of production is being placed in different parts of the world and coming together at the end as a finished product, demonstrating the world integrated economies. Transnational companies allow the process of globalisation to take place by setting up in the different countries and bringing the parts all together to make a finished product or service. However it may be argued that the increased significance of transnational companies is not a cause of globalisation but more of a result of it as such companies wouldn’t be able to set up in
Discuss the problems that independent farmers have to face with the increasing control of the global food market by large agricultural corporations. Describe the economic and ecological impacts resulting from the increasing global exchange of agricultural
Due to the worldwide trend of urbanization, fewer people are directly engages in agricultural activities. With the declining number of independent farmers, large agricultural corporations have emerged. Discuss the problems that independent farmers have to face with the increasing control of the global food market by large agricultural corporations. Describe the economic and ecological impacts resulting from the increasing global exchange of agricultural produce. Cite suitable examples to substantiate your arguments. With the globalization of agricultural, the competition of farming activities has increase greatly, from local or national scale, to a global scale competition, meaning with the advancement in transportation, their competitors no longer from neighborhood but all over the world. Large agricultural corporations benefit from the scales in economics in many ways and slowly invade and success the market of independent farmers. In general, the large agricultural corporation invade the market of independent farmers by having lower production cost. They can obtain the seeds and machines through bulk purchasing. They also have lower total transport cost of feight rate then individual farmers. As Economic Rent (ER), meaning the net profit equals to the difference between market price and the sum of production cost and transport cost, therefore it is obvious that the large
State and analyse the arguments for the privatisation of public corporations.
State and analyse the arguments for the privatisation of public corporations Privatisation is the transfer of the partial or complete control of a state activity and related assets to a private investor or investors. According to Steve. Hanke privatisation can take place in a variety of forms such as ) Contracting out 2) Partnership in the ownership, control, management of enterprises by the public and private sectors with various ownership structures 3) Total divestment and marketization of public enterprises thus turning the whole organization over to the private sector A public enterprise is defined by CARICAD studies as " an institution either wholly owned by Government or in which Government owns a majority share, that sells goods and services in the market and has its own management entrusted with the task of running the organization."1 There are many strong arguments for the privatisation of public corporations which can be studied in four categories of Economic, Ideological and Political and Organizational. Before these arguments are discussed it is critical to give a brief overview of the emergence of privatisation in the world. In developed and developing countries, privatisation is one of the most revolutionary innovations in the recent history of economic policy. The policy of privatisation of public enterprises has been adopted and implemented variably at