Compare and Contrast the Dominant Theories Explaining the Workings of Transnational Production.
Compare and contrast the dominant theories explaining the workings of transnational production.
Introduction
After the emergence of transnational corporations, economists began their careers into the study of economic globalization, therefore, the cross-border operation has become more sophisticated with many theories. Among them, the concept of a global value chain has played an important role in the development of multinational. This essay will focus on the evolution of the value chain.
Body
Since the 1980s, many scholars have put forward the theory of the value chain. Professor Michael Porter of the Harvard Business School in 1985, pointed in the "Competitive Advantage": Every enterprise is a collection of various activities in the design, production, sales, send, and auxiliary products process, all of these activities can be indicated as a value chain. The value of enterprise created through a series of activities, these activities can be divided into two types of basic activities and auxiliary activities. The basic activities include internal logistics, production, external logistics, marketing and services; auxiliary activities including procurement technology development, human resource management and corporate infrastructure. These interrelated production and business activities constitute a dynamic process of creating value, that is value chain. In "Competitive advantage", Potter also break through the boundaries of the enterprise, and extended to the perspective of economic exchanges between different enterprises, the concept of a value system, which is the basis of the concept of global value chains. Porter's value chain theory reveals that the competition between enterprises is not just competition of one part, but the competition of the entire value chain, while the overall competitiveness of the entire value chain to determine the competitiveness of enterprises.
Since the mid-1990s, according to many
Introduction
After the emergence of transnational corporations, economists began their careers into the study of economic globalization, therefore, the cross-border operation has become more sophisticated with many theories. Among them, the concept of a global value chain has played an important role in the development of multinational. This essay will focus on the evolution of the value chain.
Body
Since the 1980s, many scholars have put forward the theory of the value chain. Professor Michael Porter of the Harvard Business School in 1985, pointed in the "Competitive Advantage": Every enterprise is a collection of various activities in the design, production, sales, send, and auxiliary products process, all of these activities can be indicated as a value chain. The value of enterprise created through a series of activities, these activities can be divided into two types of basic activities and auxiliary activities. The basic activities include internal logistics, production, external logistics, marketing and services; auxiliary activities including procurement technology development, human resource management and corporate infrastructure. These interrelated production and business activities constitute a dynamic process of creating value, that is value chain. In "Competitive advantage", Potter also break through the boundaries of the enterprise, and extended to the perspective of economic exchanges between different enterprises, the concept of a value system, which is the basis of the concept of global value chains. Porter's value chain theory reveals that the competition between enterprises is not just competition of one part, but the competition of the entire value chain, while the overall competitiveness of the entire value chain to determine the competitiveness of enterprises.
Since the mid-1990s, according to many