Transnational Corporations Flashcards
Global Systems & Global Governance
What is a TNC
Transnational corporations produce, sell or are located in two or more countries.
What % of global trade is linked to TNCs?
80%
Why do TNCs have political influence?
1= Potential investment
2= Creation of jobs
3= New technology
Where are TNC’s headquarters usually located?
Big cities in developed countries, e.g. London, New York etc.
Where are TNC’s research facilities usually located?
Cities and towns where there is a supply of highly educated people, usually in the same country as the HQ.
Where are TNC’s factories usually located?
In less developed countries where there is very low production costs.
Which countries do TNC’s in the primary industry usually invest into?
Countries with large amounts of natural resources.
Which countries do TNC’s in the secondary industry usually invest into?
Countries with low labour costs and cheap land.
Which countries do TNC’s in the tertiary industry usually invest into?
Countries with a well-educated population.
Name the TNC case study.
Coca Cola
Where is Coca Cola’s HQ?
Atlanta, USA
How many countries does Coca Cola operate in?
200
What does Coca Cola do to promote itself?
Sponsor major sporting events
Where does Coca Cola produce its products?
Coca Cola operates bottling plants in Colombia. They are paid $4 a day.
What are some positive impacts brought about by Coca Cola?
1= Employs 700k worldwide
2= Creates jobs (multiplier effect)
3= Investing in sustainable packaging
4= 5by20 initiative aimed to empower 5 million female entrepreneurs.
6= Contributed $57.8bn to US economy in 2022.
What are some negative impacts brought about by Coca Cola?
1= Exploits workers
2= Contributes to obesity
3= Billions of single use plastic
4= Uses 300bn litres of water a year - contributes to water insecurity
5= Protests against Coca-Cola in India due to groundwater depletion and contamination of local water sources
What is the multiplier effect? (TNCs)
The multiplier effect is where a TNC opens a new factory which creates jobs for the local area, so people have more money to spend, helping both local businesses and the government.
