What is the relation between economics and globalization? - Kim Yeong chan

 summary

This article argues that while Transnational Corporations (TNCs) are the main actors driving globalization, the idea that they are "global beings" transcending the state is nothing more than a myth. It presents the following reasons to debunk this myth.

First, TNCs are not as global as we imagine; they conduct most of their activities in their home country. Second, their reason for expanding abroad is for markets and assets, not to exert any form of governance. Third, TNCs ultimately have a "permanent imprint" from their home country, resulting in diversity. Finally, no matter how powerful TNCs are, they ultimately require state permission to access territory and can be powerless before state power —for example, just as a corporation can face dismantlement if it gets on Trump's bad side.

 

interesting point

What I found interesting was the argument that no matter how transnational a corporation is, it inevitably retains a "local aroma." A corporation’s ultimate goal is to generate high profits. Because of this, I had assumed they would approach business with pure rationality, using data and logic to tailor all services and goods to customer preferences. I thought the proof of this would be seeing the world’s leading TNCs converge on a single, optimized profit-generation process However, as this article argues, the decision-making processes and operational methods of TNCs from different countries "have not blurred or converged." The fact that East Asian firms prefer to build direct manufacturing operations, while American firms tend to use local agent networks, serves as evidence for this. Furthermore, this brings to mind the case of Nokia. Nokia’s 'imprint' was its Finnish culture and world-class hardware engineering, but when the market rapidly shifted to a 'software ecosystem' focus with the arrival of the iPhone, this imprint became a shackle that 'blocked' innovation. Trapped by their hardware-centric 'imprint', Nokia underestimated the importance of software, ultimately ignoring the new standard (Android) which led to their collapse.

 

further questions

However, a question mark remains regarding the part about corporations still not matching the influence of the state. The recent actions and influence displayed by Jensen Huang during the APEC meeting can only be described as overwhelming.

Seeing how he provided 260,000 GPUs to South Korea through that meeting, making our country the world's 3rd largest in AI-related holdings, and watching Jensen Huang receive "state guest" treatment, it appears as though a single corporation has become a "quasi-state" entity. It seems clear that its influence has far surpassed that of other developing nations, and it is assessed to possess an influence that rivals other competitive, developed countries.

If that is the case, what will happen to our global society and economy when the moment arrives that technology becomes even more critical than it is now? I dare to predict that, as the influence of TNCs strengthens in the form of monopolies or oligopolies, a moment may come when they surpass the state. As we stand before this inevitable future, how should we handle these corporations?tion

 

 

 

Comments

  1. Hong DahyeonDecember 7, 2025 at 7:12 AM

    Your analysis was really engaging, especially the way you connected the concept of “local imprint” to real corporate cases like Nokia. I also liked how you linked recent events, such as Jensen Huang’s influence, to question the future balance of power between states and corporations. It might be even more compelling if you add a brief reflection on how societies or governments could practically respond to this shift.

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  2. LEEKIHOON 이기훈December 13, 2025 at 10:57 AM

    It was good that Nokia's case perfectly illustrated the ambivalence of the "Imprint" company. Also, the question of the rise of Nvidia and its "subordinate" companies seems to be a current challenge and a good critical thinking. Good job

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