The problem revolves around an investigation of the “mode” of function of these monopolies and the impact of their activities on the domestic corporations and economy. One may be tempted to ask: What is the effect of these monopolies on the “size” of investment in economies and corporations of poor countries like Bangladesh?
Why Multinational Corporations A Threat to the Local Corporations?
The MNCs has the most genius business developer to state their business role model to run a business in the others countries because of they have the available business funds. Especially they can take the benefits from the third world for the reason is that limited funds availability.
In case of the things local companies are able to take the chances of low cow labour or low cost training services but the multinational companies have the vast opportunities to train well the labours by hiring the well renowned trainer from the outside of the country by paying high salary.
The MNCs are already adjusted to the new things of the technology. They always bringing up with that technologies whereas the local or domestic companies need to comply with the new things or innovations of technology.
The multinational company already has the talent leaders to comply with the rapid changes of innovative ideas of the new things of the world. They can sustain easily with increasing of new things by leaps and bounds. Whereas the local companies need to hire great innovative brilliant leader to cope with the rapid growth.
Their market dominance makes it challenging for local small firms to grow well. For example, it is reasoned that big supermarkets are clutching the margins of local corner shops leading to less diversity.
In developing economies, big multinationals can use their economies of scale to push local firms out of business.
MNCs have been criticised for using ‘slave labour’ – workers who are paid a pittance by Western standards.
Some criticisms of MNCs may be due to other issues. For example, the fact MNCs pollute is perhaps a failure of government regulation. Also, small firms can pollute just as much.
MNCs may pay low wages by western standards but, this is arguably better than the alternatives of not having a job at all. Also, some multinationals have responded to concerns over standards of working conditions and have sought to improve them.