Case Study 7: Effects of MNC presence in developing countries

Overview of MNC presence in Developing Countries

Economic globalization has increased consumer demand for a greater variety of goods and has brought world trade to the largest scale ever. As companies establish plants in other countries, seeking the lowest overhead costs and most efficient economies of scale, foreign investment is also beyond earlier levels allowing multinational corporations to be dominant in many sectors. With trade barriers becoming a thing of the past, cross-border transactions have caused a more integrated world economy, including both developing and developed countries. Now, many less industrialized countries have strong export sectors and produce goods once monopolized by Western countries.

While this kind of globalization has it’s economic benefits, there are also important implications of this kind of integration. The informal regulation of multinational corporations, increase of poverty and economic inequality, and harmful homogenization are only a few of these implications. This case study will focus on the effects of the presence of MNCs in developing countries and the balance (or imbalance) of economic benefits and the cultural and environmental costs.

MNC Presence & Urban Planning in Nairobi