The globalization of production is aptly captured by phrases like 'from national production to global production', 'from local markets to global markets.' Transnational Corporations (TNCs) play significant role in this process. TNCs account for major part of the global production and international trade.
World has also seen surge in transnational direct investment. As per the liberal school of thought, TNCs are responsible for direct investment and technological inflow in the developing countries. According to the thought, Foreign Direct Investment (FDI) provides additional resources, adds revenue, increases tax base, fosters division of labour and improves balance of payments.
Indirectly, TNCs, through FDI, inject entrepreneurship, bring more effective resource allocation and enhance national welfare. Critiques, however, argue that TNCs transfer very few and wrong kind of resources, lower tax paid, promote division of labour likely to be in the company's interest and worsen the balance of payment.
Further more, they fail to change local business culture and undermine human rights. In order to attract foreign investment, governments of developing countries embark on many incentives, including creation of Export Processing Zones (EPZs).
EPZs are attractive to TNCs, since they offer low-wage labour with minimal external costs. As per an ILO study, 'The frequent absence of minimal standards and poor labour-management relations have predictable excessive wastage of materials and labour and labour unrest which are still too common in EPZs.
' Furthermore, majority of big TNCs are located in three countries, namely the USA, China and Japan. In addition, only 17 out of 500 major TNCs have appointed a women chief executive officer.
Division of labour at top leadership of TNCs facilities gender______.
Correct Answer: 4. Inequality
Solution:The passage clearly mentions that only 17 out of 500 major TNCs have appointed a woman CEO, indicating an imbalanced distribution at the top levels. This unequal representation shows that the division of labour at leadership positions produces gender inequality, not justice or freedom.
The context of leadership underrepresentation directly points to lack of parity, hence gender inequality.