Direct foreign investment and the activities of multinational corporations are new dynamic elements in the international economy. The emphasis on the growth of firms has resulted in the justification of oligopolistic direct foreign investment which may be called ‘American-type’ or ‘anti-trade-oriented’, and the justification for the domination of world production by giant multinationals of oils, copper and other primary products and sophisticated manufactured goods as well. The microeconomic, business administration approach which has been the most prominent method of analysis used in the study of multinationals has entirely neglected macro-economic theory, especially the theory of international division of labour.