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The influence of transnational corporations
The socio economic impacts of transnational corporations
Cost and benefits of foreign direct investment to host and home countries
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Recommended: The influence of transnational corporations
The Corporate Spread by John Madeley was intended to be a persuasive essay arguing that transnational corporations are secretive, unaccountable and one of the most influential actors in the global political economy (Madeley, 2013, pp. 1,17). While it is certainly possible that the general conclusion of Madeley’s essay is true; a reader of it couldn’t know because his writing lacks evidence and is full of speculation. In fact this is so much the case that it reads more like a wordy opinion piece you would find in the editorials of a newspaper than a reading used for academic instruction.
Initially, the paper starts out fine as the author introduces and defines what a transnational corporation is and provides a bit of background on foreign direct investment. Continuing the discussion on foreign direct investment is where the integrity of the essay begins to fall apart. He proceeds to describe: employment increases in TNC’s, 147 policy changes in host countries and increases in foreign direct investment (Madeley, 2013, p. 2). The problem is that the time period that Madeley is addressing covers twenty-six years and he fails to provide any context to consider this statistic in. There is no discussion about policy changes for national investment in those nations, nor is context provided demonstrating that 147 policy changes is even significant.
The author then moves on to explain to the reader how TNC’s are different from national corporations. Madeley concludes that large TNC’s have “enormous power over the governments of most developing countries, especially smaller countries” (2013, p. 5). The author does provide some supporting arguments to this claim suggesting that TNC’s are subject to preferential treatment over domestic fi...
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...transnational corporations are self-serving, abusive and morally incomprehensible with great yet completely untrue examples such as how the TRIMS agreement means that countries have to overturn economic nationalistic laws, when in fact membership in the WTO and subsequent acceptance of the TRIMS agreement is completely voluntary (Madeley, 2013, p. 11) (World Trade Organization, 2013). In all respects of his writing he has failed to persuade this reader who prefers evidence and comparative analysis to conjecture and moral imposition.
Works Cited
Madeley, J. (2013). The Corporate Spread. In H. Whiteside, & A. Ayers, Global Political Economy : Course Reader (pp. 1-17). Burnaby, BC, Canada: Simon Fraser University.
World Trade Organization. (2013). Accessions. Retrieved 11 03, 2013, from World Trade Organization: http://www.wto.org/english/thewto_e/acc_e/acc_e.htm
Naomi Klein’s No Logo states that corporations have been championing globalization using the reasons that globalization allows U.S. consumers to benefit from cheaper products produced abroad, while developing nations benefit from the economic growth stimulated by foreign investments. The generally accepted belief is that governmental policies should be established in favor of the corporations to facilitate the trickling down of corporate profits to the end consumers and workers abroad. Klein, however, contends that globalization rarely benefit the workers in the developing countries.
Financial Shenanigans was written by Howard Schilit. The main objective of the book is to show ways companies can alter their financial accounting reports to reflect a much attractive appearance of their company’s health and growth when indeed that company is running into severe trouble. There are different ways the company can accomplish this and the author gives us “Seven Shenanigans” that companies can change the investor’s point of view towards the performance of the company. Basically, he breaks up each chapter to the particular shenanigan and discusses different techniques for achieving each shenanigan. For example, the author used Priceline.com, Cendant/CUC, AOL, and Xerox to illustrate each shenanigan. Chapter 11 and 12 of the book discusses the analyzing of financial reports and how to use financial databases to discover warning signs. Then there is another chapter on finding shenanigans in the company’s annual 10K report and how to find hints for financial shenanigans.
I found this article "Foreign direct investment: Companies rush in with the cash" on the financial times website (www.FT.com) published December 11, 2002 written by John Thornhill. The reason for choosing this article is my personal interest in the Chinese economy and its attractiveness to the foreign investors. Apart from the foreign direct investment this topic has also helped me in understanding the impact of Chinese economy on the global market.
Dennis Pirages and Christine Sylvester (eds.), Transformations in the Global Political Economy (London: Macmillan, 1989).
Korten, David, 2001. When Corporations Rule The World. Berrett: Koehler Publishers; 2nd edition. pp 21-23.
Source one is an excerpt from the book called “Transnational Corporations: Knitting the world together”. This book was published in 2004 and the author is Keith Suter, a futurist. He believes that transnational corporations are now the main global economic force as they eroded the national market. He deems that due to transnational companies the world is now involved in one global market. He views transnational companies as a definite source of economic globalization. Transnational companies did not only bring jobs to less developed country but it also stimulated the economy of that country giving them motivation. Transnational companies had given less developed country a better quality of life and well-being. There are some critics about transnational companies but transnational company had given us a way to make our world more globally connected as what Keith Suter would agree upon.
Gillies, G. (2005) Transnational Corporations and International Production. Concepts, Theories and Effects, Edward Elgar, Cheltenham
Globalization has become one of the most influential forces in the twentieth century. International integration of world views, products, trade and ideas has caused a variety of states to blur the lines of their borders and be open to an international perspective. The merger of the Europeans Union, the ASEAN group in the Pacific and NAFTA in North America is reflective of the notion of globalized trade. The North American Free Trade Agreement was the largest free trade zone in the world at its conception and set an example for the future of liberalized trade. The North American Free Trade Agreement is coming into it's twentieth anniversary on January 1st, 2014. 1 NAFTA not only sought to enhance the trade of goods and services across the borders of Canada, US and Mexico but it fostered shared interest in investment, transportation, communication, border relations, as well as environmental and labour issues. The North American Free Trade Agreement was groundbreaking because it included Mexico in the arrangement.2 Mexico was a much poorer, culturally different and protective country in comparison to the likes of Canada and the United States. Many members of the U.S Congress were against the agreement because they did not want to enter into an agreement with a country that had an authoritarian regime, human rights violations and a flawed electoral system.3 Both Canadians and Americans alike, feared that Mexico's lower wages and lax human rights laws would generate massive job losses in their respected economies. Issues of sovereignty came into play throughout discussions of the North American Free Trade Agreement in Canada. Many found issue with the fact that bureaucrats and politicians from alien countries would be making deci...
... consist with the success of Mexico’s growing “GDP” thanks to NAFTA. By creating NAFTA, North America is able to not just compete in the global market but also be the supreme leader. NAFTA rules the trade of good’s and services in an international scale, with over 1.1 trillion in goods and services being traded in North America alone. NAFTA has made world markets compete at a higher level to eventually eliminate all Tariffs on a global scale for all Corporations to trade freely. The creator’s of NAFTA understood the fundamental realities, that Corporations do not have borders or belong to a single country. Corporations live and breathe without the common knowledge of patriotism. Corporations live in a “New Economic World Order”. Thanks to NAFTA the blueprint has been drawn to begin a massive change in the way the world will conduct business in the near future.
Frieden, Jeffry A., David A. Lake, and Kenneth A. Schultz. World Politics. New York: W.W. Norton &, 2013. Print.
Throughout the chapters assigned, Dicken focuses on the patterns and processes of global shifts, on the forms produced by the globalization of economic activities and on the forces producing those forms. He builds his arguments around three interconnected processes, which in his view are the reasons for reshaping the global economic map. Those are Transnational Corporations (“TNC”), States, and Technology.
...o we can achieve our dreams in life: “we are now living in a world where time and space don’t matter anymore” just like J.Mittleman said. Globalization as we just learned is relative, whether it’s an opportunity or an exploitation depends on where you sit and how you look at the world. Kent, J., Kinetz, E. & Whehrfritz, G. Newsweek. Bottom of the barrel. - The dark side of globalization (2008/March24). David, P. Falling of The Edge, Travels through the Dark Heart of Globalization..Nov 2008. (p62)
...the government owning the corporations completely. Traditionally democracies have a great sense of nationality and often reflect to the past days for a sense of “glory”. For instance the U.S. is a very nationalistic state as a vast majority of the country supports its troops occupying countries abroad. Also, not many countries in the world have citizens who proudly hang their countries flag outside their door. Though national pride for one's country shouldn’t be compared to the Nazi regime it is still an interesting look at modern nationalism.
Modern society is dominated by multinational corporations. In the past 30 years there has been unprecedented development of transnational corporations (TNC), which is “any corporation that is registered and operates in more than one country at a time” (Transnational). Now, there are more than 63,000 TNCs, while there were only 7,000 in 1970. That is more than 900% growth in TNCs in only a few decades. Even more startling, 70% of all trade, includes at least one of these TNCs (Basic).
Larsson, Thomas. The Race to the Top: The Real Story of Globalization. Cato Institute, 2001.