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17 Cards in this Set
- Front
- Back
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home country
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country in which the headquarters of a TNC is located
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host country
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other places where a TNC invests and makes profits
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Why do corps go global?
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1. exceeding domestic markets
2. resource access 3. market access (if country stops allowing imports) 4. state support 5. sourcing efficiency (ie cheap labor) |
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The Great Unbundling
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moving away from geographic specialization (trade theory) towards economic geography in which products are produced across the world
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facilitating processes of the Great Unbundling
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neoliberalism
new technological complex just in time global production increasing global inequality |
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neoliberalism as facilitator of Great Unbundling
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much easier for large firms to go around world and pick places that best fit each level of production, no restrictions on FDI
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new technology as facilitator of Great Unbundling
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new ways of producing and transporting goods b/c of information and communication technologies
TODAY- electricity= main source of energy |
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just in time production as facilitator of Great Unbundling
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rather than producing large quantities of one thing (just in case production) in hopes of selling all of it, products come exactly when the consumer wants them
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increasing global inequality as facilitator of Great Unbundling
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large businesses save $ by exporting production to places where wages are low, profits make up for the large transportation costs
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features of the commodity chain
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1. raw material --> finished product
2. organization of the chain 3. facilitating contexts (gov't, services, etc.) 4. value chain |
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the value chain
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where along the commodity chain are the PROFITS accumulated
***places along the chain are getting very unequal parts of the profit, mostly ends up in hands of wealthy retailers who have the power to dictate the process of production |
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types of commodity chain organization
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inhouse
captive supplier modular relational marketized |
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inhouse commodity chain organization
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the whole commodity chain stays within the corporation, vertical integration- from extracting raw material to finish packaged product
ex- Exxon |
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captive supplier commodity chain organization
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intra-corporate (sole purchaser) networks, supplier only supplies to that one company
ex- Boeing Dreamliner- risk b/c they're all independent contractors |
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modular commodity chain organization
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series of subcomponents that are contracted out to other firms
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relational commodity chain organization
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chain held together not only by economic and legal connections, but by socio-cultural networks too
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marketized commodity chain organization
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chain purely directly by market (no networks), everything done independently and only connected by market relations
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