Theories of the Information Society, Third Edition - Cryptome

REGULATION SCHOOL THEORY
century: the Ford Motor Company, for instance, had an international presence
long before the Second World War. However, it is important to appreciate the
rapid growth and spread of transnationals in recent decades. Today there are
over 50,000 transnationals and, though in 1950 the vast majority of North
American TNCs had subsidiaries in fewer than six countries, nowadays only a
tiny few operate on such a limited scale (Dicken, 2003, p. 50).
The size and scope of TNCs can be hard to grasp, but some idea might be
gauged by noting that, when the wealth of nations and corporations is scaled,
TNCs can account for half of the largest one hundred units. In fact, in financial
terms only a couple of dozen countries are bigger than the largest TNC. Figures
from the business magazine Fortune demonstrate that the likes of General Motors
(2004–5 revenues $194 billion), IBM ($96 billion), Royal Dutch Shell ($269 billion),
BP ($285 billion), Citigroup ($108 billion) and General Electric ($153 billion) are
indeed ‘the dominant forces in the world economy’ (Dicken, 1992, p. 49) and
transnational corporations account for as much as 25 per cent of total world
production and the vast majority of world trade (Held et al., 1999, p. 282).
Moreover, they are themselves highly concentrated, the biggest of the TNCs
accounting for the lion’s share of activity in any given sector. For instance, Dicken
(1992) identifies a ‘billion dollar club’ of just 600 TNCs which supply more than
20 per cent of total industrial and agricultural production in the world’s market
economies, yet within these giants ‘a mere seventy-four TNCs accounted for fifty
per cent of the total sales’ (p. 49).
Globalisation, in crucial ways operationalised and constructed – if not
controlled – by transnational corporations, has a number of especially significant
features. Prominent among these are the following.
Globalisation of the market
This means that the major corporate players now work on the assumption that
their markets are worldwide and that these are now open to all economic entities
with the resources and will to participate in them. Of course, even nowadays
few TNCs operate with a pure global strategy – Dicken (1992) estimates that only
4–5 per cent function in that way as yet – but this is the direction in which they
are moving.
Globalisation means that markets are today bigger than ever and that
increasingly they are restricted to those with the enormous resources necessary
to support a global presence. Paradoxically, however, markets are in key respects
more fiercely competitive than previously precisely because they are fought over
by giant corporations with the resources to have a global reach. At one time a
national market might have been dominated by a local oligopoly, but, over the
years, these have increasingly been trespassed upon by outsiders (and, of course,
energetic indigenous corporations have themselves moved outside their home
country to attack other markets). These new challengers, in establishing a global
presence, are at once bigger and more vulnerable than hitherto. Look where one
will and one sees evidence of this process: for instance, the motor industry now
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