What would you like to do?

What are the advantages and disadvantages of multinational businesses?

already exists.

Would you like to merge this question into it?

already exists as an alternate of this question.

Would you like to make it the primary and merge this question into it?

exists and is an alternate of .

Multinational Business The advantages of a multinational business to host countries are:
  • Transfer of technology,capital and entrepreneurship.
  • They increase the investment level and thus the income and employment in the host country.
  • Greater availabilty of products for local consumers.
  • Greater access to high quality managerial talentwhich tens to be scarce in host countries.
  • Increase in exports and decrease in imports,thereby improving the balance of payment of host countries.
  • Help in equalizing of cost of factors of production around the world.
  • They provide an efficient means of integrating economics.

Advantages to home countries
  • Acquisition of raw material from abroad,which is cheaper in cost.
  • Technology and management expertise accquired from competing in global markets.
  • Export of components and finished goods for assembly or distribution in foreign markets.
  • Inflow of income from overseas profits,royalities and management contracts.
  • Jobs and career opportunities at home and abroad in connection with overseas opportunities.

Disadvantages include:
  • Trade restrictions imposed at the government-level
  • Taxes or tariffs imposed on imports from other countries
  • Limited quantities (quotas) of imports
  • Effective management of a globally dispersed organization
  • Slow down in the growth of employment in home countries.
  • Destroy competition and acquire monopoly.
  • Technology designed for mnc's is for world wide profit maximization not for the social welfare or development of economy.
  • They could cause fast depletion of some of the non renewable natural resources in the host country.
  • In order to alley the fears of host countries they need to:
    • provide employment
    • train managers
    • provide products and services that raise the standard of living
    • introduce and develop new technical and managerial skills
    • increase productivity

+ 82 others found this useful
Thanks for the feedback!

What would you like to do?

What are the advantages and disadvantages of a partnership businesses?

Some advantages of a partnership business is that the gains and  losses are shared, you share the resposibilities, and it's easy to  set up. But some disadvantages to a part (MORE)

What would you like to do?

What are advantages and disadvantages of business combination?

Following are the advantages of business combination. 1. Competition between and among the companies will be eliminated. 2. Amount of capital can be increased by combining (MORE)

How to Use Mediation to Your Advantage in Business

Mediation is a common form of dispute resolution in the United States, yet it differs from arbitration in several important ways as discussed below.Procedurally, mediation has (MORE)

How to Use Arbitration to Your Advantage in Business

Arbitration is a common form of dispute resolution in the United States and can be a cost effective alternative to litigation when used wisely. In arbitration, an arbitrator (MORE)

When Should You Be Cautious About Using a Traditional IRA?

Traditional IRAs are among the most popular retirement planning vehicles. However, in certain situations, a traditional IRA may not be the best approach to accumulating your r (MORE)

Disadvantages of Taking a Pass/Fail Course

Many students think that taking a class pass/fail means working less and skating by in a course. There are some advantages associated with taking a pass/fail course, such as p (MORE)

What Are the Tax Advantages of Using a 401(k)?

There are many choices when it comes to deciding on the kind of vehicle to use to accumulate your retirement nest egg. But since their introduction in the early part of the 19 (MORE)

College 101: Advantages of Choosing an Online School

When it comes to advantages, online schools beat traditional campuses hands-down. Many people have to forgo college in favor of working one or more jobs. Traditional colleges (MORE)

What would you like to do?

Advantages and disadvantages of business organizations?

Advantages of a sole proprietorship 1. Simplest and least expensive form of business to establish and to dissolve. 2. The owner is making all the decisions and controlling t (MORE)

What would you like to do?

Advantages and disadvantages of Business growth?

Advantages: Higher profit for ownersMore status , prestige and wages for managersthe business controls a larger share of the marketeconomies of scale Disadvantages: Weaker c (MORE)

What would you like to do?

What are the advantages and disadvantages of business ethics?

 There are both advantages and disadvantages to business ethics,  but mostly are advantages. The advanatages are the company will  have an increase in reputation, more emp (MORE)

What would you like to do?

Advantages and disadvantages of small businesses?

Small businesses have their advantages such as less bureaucratic  procedures, few stirrup costs, less running costs than big  companies do and they make it easy to interact (MORE)