Globalisation, Transnationals and Economic Policy Essay

Globalisation, Transnationals and Economic Policy - Essay ExampleForeign direct investment has been in truth very important to the economic development in Central and easterly Europe over the last decade. Basically, importance is marked by successful resource seek there. Also, Market seeking is another important economic development in Central and Eastern Europe. Lastly, Efficiency seeking has improved the economic situation in Central and Eastern Europe.Basically, importance is marked by successful resource seeking there. Some parent companies invests large capital resource in night club to to acquire major factors of production that are more efficient than if the factors are obtained in its home country base. In fact, these scarce resources may not eve be available in the home economy at all. These major factors include cheap labor and natural and resources. This exemplifies why Foreign Direct Investors bushel up shop into developing countries like the Asian third world countr ies. Specifically, some parent companies would go out of its way to seek cheap and intemperately to find natural resources in the Middle East and Africa. Other foreign direct investment companies prefer to cast up manufacturing plants in in sou-east Asia and Eastern Europe because of the cheap labor costs there.This pass on increase the purchasing power of the workers in Eastern Europe. As a result This testament decrease the unemployment rate in Eastern Europe and Southeast Asia.Also, Market seeking is another important economic development in Central and Eastern Europe.... As a result This will decrease the unemployment rate in Eastern Europe and Southeast Asia.Also, Market seeking is another important economic development in Central and Eastern Europe. Some foreign direct investment companies would daringly venture in uncharted waters as they set up shop in Central and Eastern Europe. The companies main aim is to increase its market territory. Expectedly, this marketing strat egy of expansion will increase good world-wide sales thereby increasing profits. Reasonably, the parent companies only want to protect or their current sales figures. Hopefully, some parent companies just want to permeate the markets of its competitors while protecting its markets in its home country base. Some parent companies enter this type of international marketing strategy through mergers and acquisitions. Lastly, Efficiency seeking has improved the economic situation in Central and Eastern Europe. Clearly, some foreign direct investors venture into Central and Eastern Europe in enjoin to exploit the economies of scale and the scope there. The market in Central and Eastern Europe can be segregated into the rich, the average and the poor customer prospects. It is purge suggested that this type of Foreign Direct Investment can be realized after either resource or market seeking investments have been cropped up. Then, this will in all probability will increase the sales as we ll as the profitability of the firm. Typically, this is the type of Foreign Direct Investments that is mostly astray practiced in highly developed economies. This is what is actually happening within closely integrated markets like Central and Eastern Europe. EXAMPLES In Western Europe( Thuermer, 2006) state