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Globalization and the rise of multinational corporations and branding A further crucial aspect of globalization is the nature and power of multinational corporations Such companies now account for over 33 per cent of world output and 66 per cent of world trade Gray 1999 62 Significantly something like a quarter of world trade occurs within multinational corporations op cit This last point is well illustrated by the operations of car manufacturers who typically source their components from plants situated in different countries However it is important not to run away with the idea that the sort of globalization we have been discussing involves multinationals turning on any large scale to transnationals International businesses are still largely confined to their home territory in terms of their overall business activity they remain heavily nationally embedded and continue to be multinational rather than transnational corporations Hirst and Thompson 1996 98 While full globalization in this organizational sense may not have occurred on a large scale these large multinational corporations still have considerable economic and cultural power Globalization and the impact of multinationals on local communities Multinationals can impact upon communities in very diverse places First they look to establish or contract operations production service and sales in countries and regions where they can exploit cheaper labour and resources While this can mean additional wealth flowing into those communities this form of globalization entails significant inequalities It can also mean large scale unemployment in those communities where those industries were previously located The wages paid in the new settings can be minimal and workers rights and conditions poor For example a 1998 survey of special economic zones in China showed that manufacturers for companies like Ralph Lauren Adidas and Nike were paying as little as 13 cents per hour a living wage in that area is around 87 cents per hour In the United States workers doing similar jobs might expect US10 per hour Klein 2001 212 Second multinationals
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