Global Business in Local Culture: The Impact of Embedded Multinational Enterprises

Abstract

This book examines the impact of multinational enterprises (MNEs) on local economies, and presents selected case studies of MNEs operating in low income countries. By balancing external social and environmental costs against its corresponding benefits, the book demonstrates that MNEs can have a positive net-impact on local development if they build up social capital by embedding themselves in local economies and engaging responsibly with local stakeholders. By doing so MNEs contribute to inclusive growth, a central pillar of the UN Sustainable Development Goals. In this context, the book challenges popular narratives in civil society and academia that frame foreign direct investment (FDI) merely as a threat to human rights and sustainable development. Moreover, it offers practical guidance for globally operating businesses seeking to establish progressive Corporate Social Responsibility (CSR) strategies of their own. Intro; Preface; Contents; Acronyms; 1 Introduction; 1.1 Karl Polanyi's Influence in the Globalization Debate of the 21st Century; 1.2 The Bipolar Mindset in Academia, Civil Society and Government; 1.3 Acknowledging the Value of Companies Committed to 'Principled Embeddedness'; 1.4 When MNEs Become Part of the Solution Rather Than Part of the Problem; 1.5 Of Myths and Movements; 2 Societal Foundations of Economic Development; 2.1 Polanyi as the Common Denominator of Post-structuralism and Neoclassical Economics; 2.2 No Such Thing as a 'Globalization Paradox' 2.3 Polanyi as 'Intellectual Guide' in Economics and Anthropology3 Neoliberalism: A Mythical and Meaningful Term Devoid of Any Deep Thought; 3.1 Did the Rent-Seeking Economy of Feudalism Serve the Needs of the People?; 3.2 The Enclosure Movement in the UK as the Beginning of Industrial Agriculture; 3.3 Blaming Agricultural Trade Has Never Solved Any Food Security Problem; 3.4 Fernand Braudel's Criticism of Polanyi's Interpretation of History; 3.5 Why Polanyi's Bipolar Framing Finds Fertile Ground; 4 The Impact of Popular Stereotypes in Academic Research and Public Policy 4.1 Echo Chambers: The Attack on Democracy from Within4.2 Embedded Liberalism: A Flawed Concept; 4.2.1 The Artificial Separation of the 'Authentic' Local from the 'Generic' Global Product; 4.2.2 Governments as the Blameless Defenders Against Careless Big Business; 4.2.3 Why More Regulation Does not Lead to More Public Trust: The Case of GMOs; 4.2.4 Self-Regulation in Industry as a Base for Subsequent Government Regulation; 4.2.5 Why the Ruggie Framework May Not Be Harmless; 4.3 Indigenous Communities as Projection Screens for Preserved Cultural Embeddedness 4.3.1 How the Indian Chipko Movement Became a Symbol of NIMBY Environmentalism4.3.2 Myths Embodied in Scientific Models that Guide Academic Research; 4.3.3 'Epistemic Brokers' in Postmaterial Societies: The Case of Vandana Shiva; 4.3.4 Cultural Appropriation and Denial of Local Agency; 4.3.5 The Temptation in Academia to Uncritically Embrace Environmental Narratives; 5 The New Understanding of the Term 'Embeddedness' in Economic Sociology; 5.1 The Moral Dimension of Entrepreneurship; 5.2 Embeddedness as a Way to Address Three Major Coordination Problems; 5.3 Value as a Coordination Problem 5.4 Competition as a Coordination Problem5.5 Cooperation as a Coordination Problem; 5.6 Embeddedness in the Context of Economic Complexity; 6 Economic Globalization as a "Disembedding" Force?; 6.1 Why Disembedding Traditional Structures May Help Outsiders; 6.2 Disembedding Post-Colonial Structures; 6.3 How FDI Contributed to Catch-up Growth and Economic Empowerment; 6.4 'Knowledge', an Underused Resource in Efforts to Cope with Environmental Challenges; 6.5 The Failure of Foreign Aid to Empower Local Entrepreneurs Through Economic Integration