Question

Pros and Cons of MNCS Multi-national corporations (MCNs) are a controversial topic. Summarize their pros and cons for the home country (where they are headquartered) as well as for the host countries (in which they invest). (Required - 5 points possible.)

Answer 1

In their home market, multinational corporations own assets and at least one foreign nation. All assets held outside the company's territorial limits qualify for this category. Many focus on production or assets, but it may be a joint venture contract, an administrative satellite, or even research and development efforts. These assets are managed centrally from their headquarters by the corporation. Local employees are supported directly by the company, but each managing director must report to the executive team that oversees the entire operation. That structure is different from a transnational corporation, which allows each satellite to work independently with only guidance, not supervision, available for progress.

A capital inflow is provided by multinational corporations.
Many multinationals are headquartered in the developed world. To maintain their supportive revenue streams, they rely on mature market resources. These companies need to move into the developing world to make profits by investing in them. Multinationals are a major source of developmental capital inflows

Multinational corporations in the developing world are reducing government aid dependencies.
Since the 2000s, it is known that reliance on foreign assistance across the African continent is responsible for the local economies ' overall weakness. For more than 40 percent of their annual budget, some nations rely on foreign aid. Creating new assets in the developing world makes it possible for multinationals to start improving the amount of trade that takes place in the developing world.

Multinational corporations can purchase imports from countries.
For non-developed countries, the problem of economic development is an overall lack of access to capital. What's available in the United States to the average consumer is very different from what's available in a country like Somalia. Increased capital inflows help countries gain more access to the import / export market as multinationals establish a footprint in the developing world. This allows them to access better goods, create more opportunities, and ultimately raise the living standards for all.

Regional jobs is provided by multinational companies.
If you step away for a moment from the developed world, the average person works in a position related to agriculture. This industry is based on about 70 percent of the workers found in the world's poorest countries, compared to less than 5 percent in the world's richest nations. Multinationals are moving in, offering higher salaries (which are still low compared to global standards), and then changing living standards.

Higher environmental costs are generated by multinational companies.
A lack of robust environmental legislation is a primary advantage that multinationals see in doing business in the developing world. Weaker governments tend to trade additional profits for environmental harm. If these companies could outsource their production to countries with lower standards, it will lower prices, but it will also cause more damage. Countries like India even trade in waste and waste due to the revenue they earn from recycling and disposal, creating the potential for harm to local soil and water supply.

Multinationals do not always leave regional revenue.
There is evidence that multinational companies ' investments are developing local infrastructure. Homeworkers are offering new opportunities for additional education and job training. Nevertheless, once the investments are made, the company's profits continue to be repatriated for use in other fields. Looking at the net inflow of capital instead of the gross, you usually find that the actual benefit that multinationals offer is quite low (and sometimes even negative).

Importing skilled labor by multinational corporations.
Measure the amount of time needed to create local skills that promote high levels of productivity in years, not weeks or months. In order to develop their skills, multinationals invest in local workers but also need to get their venture off the ground quickly. Many companies in this situation are going to import the skilled labor they need from other economies to meet their needs. That means best jobs are given to people who don't even live in the local economy, especially in the developing world. Such incomes do not provide the same economic benefits, since spending takes place abroad rather than locally.