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Global Systems and Global Governance

Transnational Corporations

  • 3 things to know
  • Component 2

Overview

Recall questions on what a TNC is, its spatial organisation and production, vertical and horizontal integration, intra-firm trade and marketing, its positive impacts through employment, technology, infrastructure and government finances, and negative impacts through profit repatriation, on workers and the environment and through cultural homogenisation.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Key term

Define a transnational corporation (TNC).

Key term

What is intra-firm trade and how does it relate to TNC trading patterns?

Key term

How can TNCs positively impact host countries through government finances?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Define a transnational corporation (TNC).

    Model answer

    A company that operates in more than one country, with headquarters in one country and production or services in others.

  2. 2

    Describe the typical spatial organisation of a TNC.

    Model answer

    Headquarters are typically located in developed countries, while production facilities are distributed globally across multiple countries.

  3. 3

    How do TNCs organise their production across different countries?

    Model answer

    Through global supply chains that link different stages of manufacturing across multiple countries.

  4. 4

    What is vertical integration in the context of TNC linkages?

    Model answer

    When a TNC controls different stages of its supply chain, from raw materials to finished products.

  5. 5

    What is horizontal integration in the context of TNC linkages?

    Model answer

    When a TNC expands across similar businesses at the same stage of production.

  6. 6

    What is intra-firm trade and how does it relate to TNC trading patterns?

    Model answer

    Trade that occurs between subsidiaries of the same TNC located in different countries, forming a significant part of TNC trading patterns.

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