ABSTRACT
This chapter explores the rise of transnational corporations (TNCs), to gain a better understanding of their operations and significance within the world economy, especially their role in orchestrating trade. It discusses the changing geography of production with the capitalist market economy. The chapter explores reasons for the existence of firms and changes in the organization of production and its geography, and outlines the conditions under which some firms become TNCs. The global economy of the early twenty-first century is also qualitatively different from that earlier period of "arms-length" interaction, with commodity production integrated across many countries of the world in ways that we have never seen before. TNCs often form to exploit geographies of factor abundance and thus the varying prices that must be paid to secure key inputs to production around the global economy. The emergence of the global economy proceeded hand-in-hand with the growth in the number and the significance of TNCs.
