States and Firms on the Periphery: The Challenges of a Globalising World

Gabriel Benito and Rajneesh Narula

No 2007-004, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)

Abstract: A key feature of globalisation has been the growth and spread of multinational enterprises (MNEs), but there is here is considerable evidence that MNEs do not regard all locations as being equivalent. MNE activity both to and from peripheral economies differs from MNE activity associated with core economies. We discuss how and why multinational enterprises may differ in their investment behaviour from and to peripheral economies, from the point of view of both states and firms. We also provide an overview of the policy issues associated with the peripheral nature of these economies per se, as well of the policy issues associated with MNEs that invest into and from peripheral economies. Inter alia, we argue that market forces cannot fully substitute for the role of governments in developing and promoting a proactive industrial policy.

Keywords: Multinational Enterprises; Foreign Direct Investment; Industrial Policy; Organizational Behavior (search for similar items in EconPapers)
JEL-codes: D23 F21 F23 L52 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (7)

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Chapter: States and Firms on the Periphery: The Challenges of a Globalizing World (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:unm:unumer:2007004

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