Characteristics of TNCs

Transnational Corporations (TNCs)

In this course, Dr Crispian Fuller (Cardiff University) explores transnational corporations (TNCs) and global production networks. In the first module, we look at what TNCs are, their centrality to the contemporary global economy, and some of their key characteristics. The second module then considers why they have become so important, and asks whether their growing economic power has made them “placeless”. In the third module, we turn to TNCs and labour markets, examining the role of corporations in the creation of an international spatial division of labour and the reinforcement of uneven economic development. Modules four and five discuss global production networks – the highly complex relationships between corporations, suppliers and contractors which underpin TNCs’ activities – outlining how they have developed, their characteristics, and problems associated with them. In the sixth module, we think about labour regulations, how they differ between states, and the impact they have on TNCs. We conclude with a seventh module on the relationship between TNCs and national governments, focusing on the important issue of which has the greater power in the contemporary global economy.

Characteristics of TNCs

In this module, we think what TNCs are and some of their key characteristics. We focus on: (i) their central role in the global economy, particularly in reinforcing uneven development; (ii) the legal status of corporations; (iii) their transnationality, grounded in their use of subsidiaries and outsourcing, and the issue of centralisation versus decentralisation in how they manage their activities; (iv) their internal organisation – an important distinguishing feature of TNCs is that they are not vertically integrated, but rather operate through diffuse horizontal networks; (v) TNCs as geographers – a critical aspect of their activities is that they take account of geographical differences to find and exploit location-specific economic advantages; (vi) the difficulty in generalising TNCs due to the different strategies they adopt regarding centralisation and the organisation of production.