ABSTRACT
A multinational corporation (MNC) 1 is “an enterprise that engages in foreign direct investment (FDI) and that owns or controls value-added activities in more than one country.” 2 A firm is not really multinational if it just engages in overseas trade or serves as a contractor to foreign firms. There are a number of ways of assessing the degree of multinationality of a specific firm. For example, firms are considered to be more multinational if (1) they have many foreign affiliates or subsidiaries in foreign countries; (2) they operate in a wide variety of countries around the globe; (3) the proportion of assets, revenues, or profits accounted for by overseas operations relative to total assets, revenues, or profits is high; (4) their employees, stockholders, owners, and managers are from many different countries; and (5) their overseas operations are much more ambitious than just sales offices, including a full range of manufacturing and research and development activities. 3
