How Is the Production Process of Multinational Corporations Hierarchical

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The Answer is Global values chains create a hierarchy by creating an international division of labour. Coordinated by MNCs, these production processes fragmented across borders, as labour intensive and low-skill production processes relocated to low-wage developing countries while high-skill high-wage activities remained at home. This is linked to the transferring of manufacturing by MNCs to developing countries in the 1970s. Global value chain theory, which emerged in the 1990s, identified this hierarchical relationship that brings a product to market, and MNCs as coordinating, or governing, the multitude of relationships between the various companies involved.

How Is the Production Process of Multinational Corporations Hierarchical

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