What are disadvantages of multinational corporations?

In: Small Business and Entrepreneurship, Business Plans, Economics [Recategorize]

The adverse effects of MNCs

A.On the home country:

1.Loss of jobs.
2.Loss of tax revenue.
3.Flexibility of operation is reduced in a foreign political system and thus causes instability.
4.Competitive advantage of multinationals over domestic firms.

B.On the host country:

1.Remittance of dividends and profits that can result in a net outflow of capital
2.MNCs engage in anticompetitive activities such as formation of cartels and dumping..
3.MNCs offer higher wages to its employees in the host countries,which is much more than any other domestic firm.
4.Obsolete technology may be used in the host country.

First answer by ID0415633632. Last edit by ID0415633632. Question popularity: 5 [recommend question]

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