What are transnational corporations and why do they grow?

Also known as MNCs (Multinational Companies) these are large businesses that operate in a number of countries. They often separate their production between various locations, or have their different divisions – Head Office and Administration, Research and Development, Production, Assembly, Sales – separated around a continent or the globe.

Some reasons for the growth of TNCs include the global expansion of a major product with worldwide markets, such as Coca Cola, the take-over of foreign competitor firms, such as BMW, Mmerger with foreign firms into one large international company, such as GlaxoSmithKline or the vertical integration: acquiring the companies that sell you materials and components, and/or that you sell on to for manufacture, assembly or sales.

In terms of their location, TNCs can affect where in the world employment is growing, where it is declining, which national economies are expanding and which are contracting, and the movement and flow of goods, services and employees between various parts of the world.