Corporate connections

HideShow resource information
View mindmap
  • Corporate connections
    • Corporate colonialism
      • the East Indian Company ruled 20% of the worlds population and was probably the first TNC
      • The top 200 TNC's account for 25% of the worlds economic activity and employ 1% of the worlds work force
      • 6 of the top 10 TNC's originate in the US and make more money in a year than a countries entire GDP
      • The top three TNC's are Exxon Mobil (US), Wal-Mart (USA) and Royal Dutch Shell (Netherlands and UK)
    • How do TNC's grow?
      • Motive
        • Horizontal integration - by buying up the competition
          • Ford moved from mass-market sales up to up-market sales by acquiring Jaguar, Volvo and Land Rover
        • Vertical Integration - by controlling and owning every stage of production from exploration to research through to sales
          • Exxon own oil wells, oil tankers, oil refineries and petrol stations, there is no middle-man
        • Economies of sale - companies expand production (e.g. Apple computers) to increase efficiency and reduce unit production costs
      • Means
        • Companies invest overseas to boost their market presence or to take advantage of labour and environmental laws
          • Growing trend in this century has been for TNC's from developing countries to invest overseas
        • A kind of Reverse Colonialism is happening where the poorer countries now account for more than 15% of overseas investment
      • Mobility
        • accelerated and cheaper transport - including the use of ever-larger container ships
        • accelerated communications systems - using fibre optics, satellite and digital technology
        • Production systems that can provide cheap and fast turn around like "just-in-time" production
    • Searching globally, selling locally
      • Criticisms of supermarkets are more to do wit the way that most food in the UK is sourced and sold
        • Large supermarkets search the world in order to deliver the best-priced or guaranteed quality foood to their customers
          • The bigger the company the bigger its purchasing power is and its ability to control suppliers and prices
      • In the case of fresh food, this means that produce is flwon or shipped from one side of the world to another to supply out-of-season fruit or veg
      • As they search for the cheapest food they sometimes expolit the farmers and force the prices down
    • Searching locally, selling globally
      • Land has to be cleared in order to have more farm land to supple the demand that supermarkets require to feed the UK
      • But TNC's bring both employment and money into a developing economy
        • As well as employment, it gives the workers certain skills that can give them an opputunities to make their own businesses or to better paid companies


No comments have yet been made

Similar Geography resources:

See all Geography resources »See all The economy and global superpowers resources »