The impact of multinationals on the economy of the host country

Abstract

Most of the time, it comes to the mind of many economists, why these economic differences between the countries of the world? Is it because of the abundance of productive economic resources to produce goods and services for a country, for example, to the exclusion of other countries? Or because some companies control the products of that country. And even the method of marketing those products. In the context of globalization, states and local authorities compete (through financial support or tax facilities) to attract multinational companies. While the outcome remains subject to controversy if we take into account employment, social balances, industrial and agricultural structure, and the trade balance. The argument that works in favor of companies is the idea of technology transfer, that is, the introduction of more effective production, organization and management methods to the host countries with an improvement in work specifications. It is noted that multinational companies are characterized by many monopolistic advantages that made them fully control markets outside their national borders, as these companies enjoy strong financial positions in the country of origin, compared to local companies in the country of investment. Multinational companies have superior and growing financial positions, and marketing advantages are considered one of the most important monopolistic characteristics that multinational companies have compared to national companies that are in a very weak position. International multinational companies have the ability to carry out marketing research to learn about market conditions and consumer tastes and predict Possible changes at the level of production, consumption and distribution. This research will include: a historical look at multinational companies, the characteristics or features of these companies, the impact of these companies on globalization, the emergence of global blocs, and the negative aspects of those companies at the level of Arab countries (including Iraq).