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Multinational Corporations and Foreign Direct InvestmentAvoiding Simplicity, Embracing Complexity$
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Stephen D. Cohen

Print publication date: 2007

Print ISBN-13: 9780195179354

Published to Oxford Scholarship Online: May 2007

DOI: 10.1093/acprof:oso/9780195179354.001.0001

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 Why and How Multinational Corporations Have Altered International Trade

 Why and How Multinational Corporations Have Altered International Trade

Chapter:
(p.205) 9 Why and How Multinational Corporations Have Altered International Trade
Source:
Multinational Corporations and Foreign Direct Investment
Author(s):

Stephen D. Cohen

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780195179354.003.0010

One of the less contentious issues surrounding MNCs is their significant and still increasing impact on international trade flows and policy. This trend is the result of increasing reliance by large manufacturing companies on FDI as an alternative to exporting to sell their goods and services to customers in other countries. This chapter surveys the data demonstrating the extent to which FDI has displaced exports as a marketing vehicle and altered the product composition of many countries' exports and imports. It presents several country case studies to provide more specific and detailed insight into changing national trade patterns. The other two topics discussed at length are the questions first, of the likely extent that the proliferation of FDI has decreased national exports and jobs, and second, of the extent to which FDI proliferation has rendered traditional trade theory largely or totally obsolete.

Keywords:   exports, imports, intra-firm trade, job creation, job displacement, comparative advantage

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