How superpowers influence culture and economy through TNC's

Question 1

What ‘flavours’ do TNC’s come in?

Answer 1

• Publicly traded TNC’s whose shares are owned by various shareholders (usually other TNCs, banks, financial institutions e.g. pension funds etc.)
• State (gov) owned TNC’s - ran by govs

Question 2

What has caused dominance of TNC’s in the global economy?

Answer 2

• TNC’s able to outcompete smaller businesses and take over them.
• TNC’s ability to borrow money to invest has allowed them to take advantage of globalisation by investing in new tech.
• The move towards free market has opened up new markets allowing them to expand.

Question 3

Who drives TNC’s to maximise their profits?

Answer 3

Shareholders

- managers recieve large salaries + bonuses for generating profits, but the shareholder institutions recieve even more.

Question 4

Key critism of TNC’s as a driver of globalisation

Answer 4

Is the pursuit of shareholder profit above all else - want to make money which means the rich get richer, the poor get poorer.

Question 5

Has there been a shift in where TNCs orginate?

Answer 5

YES - a dramatic shift in the origin of the world’s largest companies since 2005 - reflecting the rise of emerging powers - 400 of the 500 largest TNC’s come from 7 countries, but China’s share of these are rising at the expense of USA and EU.

Question 6

How much revenue does the top 500 largest companies create:

Answer 6

Revenues totaling more than 1/3 of the world’s GDP.

Question 7

Are all China’s largest companies state owned or publicly owned?

Answer 7

All state owned - Chinas top 12 companies are stated owned.

Question 8

Other roles TNC’s have + how they are able to assert dominance

Answer 8

• influence the innovation of new tech and development of new products.
• enforce intellectual property laws - these protect new developments through e.g. copyright, patents, trademarks - protects designs e.g. logos
• Patenting means if another company want to use there tech - they have to pay a royalty fee to the inventor - a cost for them but a huge profit for the TNC who invented the product - allows TNC’s to gain dominance.

Question 9

How TNC’s influence culture

Answer 9

Through cultural imperialism - a superpower imposing ideas or values on less powerful countries.
- e.g. Westernisation is when global culture is becoming dominated by USA + Europe, mcdonaldisation dominating fast food restaurants globally etc.

Question 10

Key factors promoting cultural globalisation:

Answer 10

• internet - access is increasing which increases access to info/culture.
• global media
• Increased air travel - promotes migration and spread of cultural ideas.
• growth of global TNCs - bringing western products to the rest of the world.
• increasing global trade flows - which increases dependence on each other as more people are accessing products.
• language free brand logos e.g. apple - no lang barrier
• Spread of English as the national language
• growth of global tourism - shared culture and culture mixing eroding indigenous cultures.