By Ramachandra Guha

Essays on Indian culture,politics, a few comparative with western issues

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A decentralised, network-based organisation is emerging as the new paradigmatic model, facilitated by advances in information and telecommunications technology (IT&T). The three groups of theories help to explain the relationship between MNCs, governments and RED through their contribution to understanding: . Structural changes and their impact on MNC and state organisation and strategies. The impact of new forms of competition, new sources of com- petitive advantage and new industrial organisation on FDI and the prospects for economic development.

Increased the corporate rationale for moving towards strategic collaboration for R&D. The costs, risks, complexity and pace of technological advance have therefore encouraged FDI, inter-firm co-operation and new organisational structures, facilitated by rapidly falling costs and advances in transport and communications. Information and telecommunications technologies were a necessary condition, if not cause, of the rapid growth of MNCs and integration of economic activity (Dicken, 1992a: 97; Chesnais, 1993: 13±14; Chan, 1996: 2).

The reduction or removal of barriers to trade and factor flows associated with regional integration and trade and capital market liberalisation on an international scale has underpinned the growth of FDI (Dunning, 1998: 47±8; Karl, 1996: 1±2; Peck and Stone, 1996: 62). Liberalisation of FDI facilitates production for differentiated markets, allowing firms to have a local presence in overseas markets, take advantage of scale economies in production, marketing, distribution, and R&D, and exploit their comparative advantage globally.

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