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SophieClark
| Reward Points: | 3 |
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Efficiency is a measure of the effectiveness of your arguments. It is the number of up votes divided by the total number of votes you have (percentage of votes that are positive). Choose your words carefully so your efficiency score will remain high. | 86% |
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It could be argued that with FDI, MNCs would pass on their knowledge and technology to the developing country in which they are setting up in. This would lead to an increase in the standard of living, which leads to economic development. However, not only would this not increase employment as jobs done by people would be replaced by machines, it is also very unlikely that MNCs will actually pass on their knowledge to these countries as this would lead to them losing their competitive advantage. By doing this MNCs can also cause local companies to go out of business, further adding to the unemployment. An example of this is the effects of the FDI on the Polish construction sector which led to local companies to fail as they could not keep up with he new competition.
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