New Login   

Multinationals and the Developing World

Ashwini K. Ray

By S. Shiva Rau
Sultan Chand and Sons, Delhi, 1976, Rs. 30.00

By P.K. Ghosh  and V.S. Minocha
Sultan Chand and Sons, Delhi, 1977, Rs. 35.00

VOLUME III NUMBER 3 November/December 1978

With the increasing realization of the role of Multinational corporation as the coupling mechanism in the structural linkage between the 'centre' of the Imperi­alist system with its 'periphery' the literature on the working of Multinationals in the Developing world continues to grow. By now, in purely quantitative terms, the literature on the subject is quite formid­able. Though the books under review provide no new insights into this subject are welcome attempts as they deal with it with specific reference to India. Shiva Rau's book is a dilettantish attempt at analysing the goals, motiva­tions and business strategy of the Multi­nationals. It contains an equally perfunc­tory discussion on the impact of ‘environ­ment’ on the MNCs, and includes some ‘guidelines to Indian investors abroad’ and a ‘case study of the operation of the Raymond Mills (belonging to the JK group of India) in Kenya to conclude that ‘export and establishment of subsidiaries in foreign countries are related’. The book begins with a rather pro­mising introductory chapter with extre­mely simplified (almost simplistic) analysis of the various phases of development of the national firms to their eventual trans­formation to multinational status. Some of the known expectations of the develop­ing countries from the MNCs are dis­cussed, but in the absence of analytical rigour and empirical data about the actual operation of the MNCs, some of the author's conclusions, are not clear. For example, what exactly the author means when he concludes in the preface that ‘multinationalism is a state of system which none can completely avoid’, rem­ains unintelligible at least to the reviewer. Similarly some other conclusions appear a priori. It is difficult to sustain the view that ‘the time and nature of establishment (of MNC subsidiaries) is determined by the nature and policies of the recipient countries concerned’. unless one is referring to the purely format aspect of the decision-making process, except in the formal sense, in the developing countries that are structurally linked at various institutional tiers with the 'Heartland' of the capitalist world, is more limited than the author seems to take for granted. The author's assumption that the capitalist division of labour is simply a system of ‘complemen­tarity’ as evident from his laudatory reference to the Latin American Coun­tries for promoting such industrial ‘com­plementarity’ through bi-lateral and multinational agreements, is again an extremely simplistic view of a ...

Table of Contents >>
Please or to Read Entire Article

Free Access Online 12 Back Issues
with 1 year's subscription
Archive (1976-2011)
under construction.