States and Firms on the Periphery: The Challenges of a Globalising World
G. Benito & R. Narula
A key feature of globalisation has been the growth and spread of
multinational enterprises (MNEs), but there is here is considerable
evidence that MNEs do not regard all locations as being equivalent. MNE
activity both to and from peripheral economies differs from MNE activity
associated with core economies. We discuss how and why multinational
enterprises may differ in their investment behaviour from and to
peripheral economies, from the point of view of both states and firms.
We also provide an overview of the policy issues associated with the
peripheral nature of these economies per se, as well of the policy
issues associated with MNEs that invest into and from peripheral
economies. Inter alia, we argue that market forces cannot fully
substitute for the role of governments in developing and promoting a
proactive industrial policy.
UNU-MERIT Working Papers