Question

write an essay on the role of TNCs in age of globlization.

Answer 1

Answer:

Globalisation is a complex phenomenon which is more in the nature of a process than a state of affairs. There have been several attempts at definition (McGrew, 1992; Oman, 1996; Castells, 1996; Giddens, 1999; Held et al. 1999).2 Most definitions boil down to the fact that globalisation is both a process of geographical/spatial outreach and of an increased degree of interconnectedness and interdependence between people, groups and institutions based in different countries of the world. As a process of spatial outreach it is not new and has long historical antecedents (Held et al., 1999). Nonetheless it is argued in this chapter that the current process is considerably different from any previous process of outreach. One of the major differences is seen in the role that transnational corporations (TNCs) play in the globalisation process.The chapter proceeds in section 2 with an analysis of the salient characteristics of the globalisation process. The third section considers the role of TNCs in cross-border transactions. Section 4 develops the argument that the TNCs are a dominant cause of the globalisation process. Section 5 considers the wider policy implications of this perspective and the last section concludes.2. Salient characteristics of globalisationThe current globalisation process is characterised by both qualitative and quantitative aspects and it differs from previous outreach processes in many of these aspects. The process is cumulative and thus the various aspects and mechanisms reinforce each other.Among the qualitative aspects of globalisation the following play an important part:lBreadth of change. The changes now involve a variety of fields or ‘domains’ (Held et al., 1999) ranging from the economy and society in general, to population movements, to the business sector, to politics, to the military, the environment and culture. lPolitical basis. The process has been reinforced by the economic and social policies of deregulation and liberalisation now involving most countries in both the developed and developing regions.lFinancial domination of the economy. The dominance of finance capital is not new in capitalism. However, the last 20 years have seen such dominance reaching unprecedented levels both in terms of intensity of financial activities in relation to the size of economies, and in terms of number of countries involved in financial transactions. On this issue Palma (2009) writes: ‘…the four components of the stock of global financial assets (equity, public and private bonds and bank deposits) increased 9-fold in real-terms between