GGR325H5 Lecture Notes - Lecture 2: Portfolio Investment, Network Virtualization, Vertical Integration
Document Summary
With varying degrees of functional integration: internationalizing processes: Geographical spread of economic activities across national boundaries. High degree of function integration: regionalizing processes. Operation of globalizing processes at more geographically limited (but supranational scale) Production of manufactured goods: manufactures ->>>, periphery. Source of raw materials and food stuffs. In short: 3 major dimensions of world"s growing interconnectedness. Fdi (foreign direct investment) has grown faster than trade. ~ gaining a degree of control: foreign direct investment (fdi) Either through: controlling investment in foreign firm, through subsidiary. Purely for financial reasons: fdi as measure of tnc activity. Does not capture complexity of production networks . Transnational corporation (tnc): firm with power to. Control: operations> 1 country, even if it does not own them. Ability to coordinate and control various processes and transactions. Both within & between different countries: 2. Potential ability to take advantage of geographical differences. State policies: taxes, trade barriers, subsidies. Factors of production: natural resources, capital.
