The Globalization Trend

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Paper points to rise of global trade as consequence of parents firms in multinational networks losing a little of their relative importance in their home economies, especially in manufacturing.

Paper addresses tensions in global economy such as shrinking communication and transport costs that in turn stimulate firms to make investments exert great power over long distances. Author argues that multinational enterprise is not just basing itself on lower price inputs, but dependent on regional bias. E.g., locational decisions will be driven by a preference for the familiar and the avoidance of uncertainty, by the containment of political and economic risk, by considerations of scale, by factors of agglomeration and infrastructure, and by the requirements of rivalrous tactics.

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