Essay on multinationals

More Essay Examples on Corporation Rubric In the current era, organizations are changing their methodology of working and they are expanding their vision - Are multinationals free from moral obligations? There operations are enlarging and they are leaving methods that are conventional. Newer methods like offshore outsourcing, globalization, internet advertising are changing the methodology of working. Business practices in the entire world are changing and moral values are depleting because organizations are focusing towards making more profits.

Essay on multinationals

This helps to accumulate information and the flow of new and innovative ideas among firms for the achievement of what economists call increasing returns to scale. Increasing returns to scale, and economies of scale, are internal to a firm and may allow for the establishment of more of the same firm outside the area or region.

Economies of scale external to a firm are the result of spatial proximity and are referred to as agglomeration economies of scale. Agglomeration economies may be external to a firm but internal to a region.

It is important to note that these increasing returns to scale are a major contributing factor to the growth of cities.

Board of Directors

Agglomeration economies exist when production is cheaper because of this clustering of economic activity. Essay on multinationals a result of this clustering it becomes possible to establish other businesses which may take advantage of these economies without joining any big organization.

This process may help to urbanize areas as well. Benefits arise from the spatial agglomeration of physical capital, companies, consumers and workers: Disadvantages of agglomeration[ edit ] While the existence of cities can only persist if the advantages outweigh the disadvantages, agglomeration may also lead to traffic congestion, pollution and other negative externalities caused by the clustering of a population of firms and people and that this may lead to diseconomies of scale.

Large cities experience these problems, and it is this tension between agglomeration economies and agglomeration dis-economies that may contribute to the growth of the area, control the growth of the area, or cause the area to experience a lack of growth.

Other Western Élites

The disadvantages of agglomerations are to be mentioned: Types of economies[ edit ] There are two types of economies that are considered large-scale and have external economies of scale; localization and urbanization economies.

Localization economies arise from many firms in the same industry located close to each other. There are three sources of localization economies: The first is the benefit of labor pooling which is the accessibility that firms have to a variety of skilled laborers, which in turn provides employment opportunity for the laborers.

The second benefit is the development of industries due to the increasing returns to scale in intermediate inputs for a product; and the third source is the relative ease of communication and exchange of supplies, laborers and innovative ideas due to the proximity among firms.

Core-periphery model[ edit ] Whilst localization and urbanization economies as well as their sources are crucial to sustaining agglomeration economies and cities, it is important to understand the long-term result of the function of agglomeration economies which relates to the core-periphery model.

The core-periphery model basically features an amount of economic activity in one main area surrounded by a remote area of less dense activity. The concentration of this economic activity in one area usually a city center allows for the growth and expansion of activity into other and surrounding areas because of the cost-minimizing location decisions of firms within these agglomeration economies sustaining high productivity and advantages which therefore allow them to grow outside of the city core and into the periphery.

A small decrease in the fixed cost of production can increase the range of locations for further establishment of firms leading to loss of concentration in the city and possibly the development of a new city outside the original city where agglomeration and increasing returns to scale existed.

If localization economies were the main factor contributing to why cities exist with the exclusion of urbanization economies, then it would make sense for each firm in the same industry to form their own city. However, in a more realistic sense cities are more complex than that, which is the reason for the combination of localization and urbanization economies to form large cities.

Source of economies[ edit ] From the localization of firms emerges labor market pooling. Large populations of skilled laborers enter the area and are able to exchange knowledge, ideas, and information.

The more firms there are in this area, the greater the competition is to obtain workers and therefore results in higher wages for the workers. However, the fewer firms there are and the more workers there are at a location the lower the wage becomes for those workers.

The second contribution towards localization economies is the access to specialized goods and services provided for the clustering firms. This access to specialized goods and services are known as intermediate inputs and provides increasing returns to scale for each of the firms located within that area because of the proximity to available sources needed for production.

If intermediate inputs are tradable, there forms a core-periphery notion that will have many firms locate near each other to be closer to their needed sources. If there are tradable resources and services nearby but no related industries in the same area, there are no networking linkages and therefore makes it difficult for all firms in the area to obtain resources and increase production.

The decreased transportation costs associated with clustering of firms leads to the increase in likelihood to a core-periphery pattern; where the result of this will be more intermediate inputs will be focused at the core and therefore will attract more firms in related industries.

Essay on multinationals

The third source relating to localization economies is technological spillovers. One final advantage of this source is that clustering in specific fields leads to quicker diffusion of ideas or adoption of ideas. In order for production to be at its maximum and sell their products, firms require some sort of feasible access to capital markets.

New forms of technology can create problems and involve risk; the clustering of firms creates an advantage to reduce the amount of uncertainty and complications involved with the use of new technology through information flow. The industry of capital flow and technology are concentrated within specific areas and therefore it is to the advantage of the firm to locate near these areas.

This technological impact specifically in the communications field will provide and dismiss the barrier between firms in the same industry located further away as well as nearby which would lead to a greater concentration of information flow and economic production and activity.

Furthermore, technological spillovers may be more beneficial to smaller cities in their growth than larger cities because of the existing informational networks in larger cities that already helped them to form and grow.

Basis for state redistribution from suburbs to cities[ edit ] Achieving economies of agglomeration is the reason many U. This is often achieved through grants to local governments according to criteria that favor low-income communities.This essay is organized as follows: the first section is about the HRM practices in Japan and their development; the second part is about the main differences between Japanese and Chinese HRM practices and the third and last one examines the problems that the Japanese HRM practices face in their subsidiaries in China.

Major multinationals. Multinational Business Corporations Gaining More Power in Society. Multinational Business Corporations Gain More Power Multinational Business Corporations Gain More Power The world is entering a period where corporations are gaining more power in society.

More Essay Examples on Corporation Rubric. In the current era, organizations are changing their methodology of working and they are expanding their vision - Are multinationals free from moral obligations? introduction?

Essay on multinationals

There operations are enlarging . The Mughal emperor Shah Alam hands a scroll to Robert Clive, the governor of Bengal, which transferred tax collecting rights in Bengal, Bihar and Orissa to the East India Company.

Published: Mon, 5 Dec The automobile industry under deliberation is Toyota Motor Corporation. Being in the middle of the premier auto-manufacturing companies in the universal surroundings, it presents a gigantic range of autos from mini-vehicles to giant transportation motor vehicles. Nanjing (), formerly romanized as Nanking and Nankin, is the capital of Jiangsu province of the People's Republic of China and the second largest city in the East China region, with an administrative area of 6, km 2 (2, sq mi) and a total population of 8,, as of The inner area of Nanjing enclosed by the city wall is Nanjing City (南京城), with an area of 55 km 2 (21 sq mi.

Essay on Multinational Companies Essay Example for Free