This book envisions international business as a process of continuous interaction between an organization and its external environment. THE ENVIRONMENT will deal with the external business environment in terms of human interaction with the natural habitat. This chapter deals with the first element of this organization-environment interaction: the organization. In the international business vocabulary, this organization goes under different names. Some writers refer to it as the multinational corporation (MNC). Others call it the transnational enterprise (TNE), and still others use the name multinational enterprise (MNE). In this book the term MNC will be used because it is the one most widely used in the U.S. literature.
The complexity and diversity of an MNC's activities make any kind of analysis of MNCs exceedingly difficult. There is no general consensus about either the nature or the role of an MNC. This chapter will summarize current views of this extremely controversial question: What is an MNC and what role does it play in humanity's struggle for survival?
LEARNING OBJECTIVES
After studying the material in this chapter, the student should be familiar with the following concepts:
- Multinational corporation (MNC)
- The reasons businesses become MNCs
- The size of the world's MNCs
- Advantages of an MNC
- Disadvantages of an MNC
- The impact of an MNC on the host country
- The impact of an MNC on the home country
- The names of some of the largest U.S. MNCs
- The names of some of the largest European MNCs
- The names of some of the largest Japanese MNCs
- The Dependencia School
- The Sovereignty at Bay School
- The American Challenge
- Five main issues in the debate about MNCs
- Benchmark study
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