Blog Assignment 4: What is the relation between economy and globalization? ---CHENG SHIYI

  Summary

The critical role of multinational corporations in the global economy and the ways in which they expand internationally through various investment models. Early international economic development saw the rise of chartered trading companies, such as the East India Company and the Hudson's Bay Company, which had a key impact on the global economic landscape. However, the rapid growth of modern multinational corporations has made them major shapers of the global economy.

The motivations of enterprises to participate in transnational activities are mainly divided into market-oriented and asset-oriented. Market-oriented investment drives companies to find new markets, especially when domestic markets are saturated. Asset-oriented investment focuses on unevenly distributed production assets, forcing companies to make international strategic investments to improve efficiency.

In terms of expansion methods, companies have chosen a variety of investment models, among which cooperation with other companies is increasingly favored. Strategic alliances have become an important mechanism for multinational companies to achieve international expansion. Alliance networks are formed through multilateral relationships, bringing more diverse and complex dynamics to the global economy.

The activities of multinational corporations come in many shapes and sizes and are far from being simple global corporations. Their influence on global markets and resources has become increasingly significant, shaping a new pattern of economic globalization. Over the past 50 years, multinational companies have not only expanded their scale and geographical distribution through various investment methods, but also promoted the integration of the global economy and become a key driving force for economic globalization.

The development of multinational companies often goes through specific stages, including exporting services, setting up sales outlets, and greenfield investments or acquisitions. However, this order is not absolute, and interruptions or "short circuits" sometimes occur. Geographic factors still play an important role in the development of TNCs, interacting with the local characteristics of the country in which they are located to produce unique economic results.

Finally, corporate networks are viewed as complex, dynamic networks of production, distribution, and consumption, and transnational corporations exhibit complexity and diversity in global governance, multi-scale regulatory systems, and relationships between states and other stakeholders. The article calls for the avoidance of simplistic views, emphasizing that MNCs are not always dominant but are in a dynamic process of interaction with other actors.

Interesting point

The geographical embeddedness of multinationals, place and geography still have a fundamental impact on how companies produce and behave – so how do multinationals manage supply chains that span multiple countries? How to successfully promote your brand to different places? I think this is an interesting question.

Discussion

1.How do multinational companies take advantage of the opportunities of economic globalization to achieve sustainable development?

2.How to balance the relationship between economic globalization and national security?

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