MNCs usually set up production units across the globe in places where the market is nearby, there is the availability of skilled and unskilled labour at low costs and other factors essential to the growth of production.
1. The setting up of production in various countries leads to the development of products globally. Sometimes, the MNCs might also set up production with the local companies of a country as a joint responsibility, thus bringing in the latest technology and foreign investment.
2. The MNCs also link and control the production of goods. Large MNCs in developed countries often place orders for production with small producers all around the world which are then sold by the MNCs under their brand name.
3. The power of control and influence of such corporations has contributed to the interlinking of such widely dispersed locations across the globe.
NOTE – MNCs are increasingly entering the local markets of various countries and playing the role of integration of these markets with the world economy and thus contributing immensely to the process of globalization. MNCs, in rapid course of time, have not only resulted in the global expansion of their brand names but have also made the process of production and selling of goods and services, a complex and interdependent process.
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