In the epoch of globalization, multinational corporations (MNCs) became powerful and international actors on the international stage. This position was achieved partly due to the practice of attracting external resources from third-world countries. Alongside globalization, in the modern world, global stratification is an immensely significant phenomenon that refers to the arrangement of societal groups according to hierarchy all over the world. The current essay examines the positive and negative sides of Nike’s influence on host countries’ cultures. The paper also analyzes the effects that global stratification brings to the United States (the US).
As it has already been said, global stratification implies the hierarchal placement of societies in the world. Any hierarchy signifies the existence of inequality between those who take the higher and lower positions. This logic applies to the national level and means that global stratification leads to the widening gap in the GDP levels of countries (Bergesen & Bata, 2002). Undoubtedly, outsourcing helps host countries to overcome the issue of unemployment through the creation of factories where people could find paid jobs. What are more, employees gain more experience and knowledge and become aware of how to work with advanced equipment. In the future, workers could apply their skills while working in domestic enterprises. Consequently, this could raise the quality of the produced goods and their attractiveness on the market.
Still, the case of Nike reveals that MNCs tend to harm the well-being of local people in underdeveloped countries. Merk (2015) marks that the working conditions of Nike’s factories in developing countries are rather weak. Additionally, it is widely known that in the early 2000s, Nike had been using child labor on its plants in Pakistan. From this, it could be inferred that such a powerful MNC as Nike brings not only positive but also negative impacts on the host countries culture since it strives to economize labor costs and safety standards.
Global stratification has an enormous influence on the US since it is one of the world’s wealthiest countries. One could conclude that the differentiation of nations is unprofitable for the US since MNCs tend to locate factories in underdeveloped countries with cheap labor costs. For instance, Nike establishes production in the states of South-East Asia. Therefore, such decisions contribute to the growth of unemployment at the domestic level. Nevertheless, Moran and Oldenski (2016) concluded that when American companies locate production abroad, they also hire more workers at home. This point might seem like a contradiction; however, when a corporation has a lot of factories overseas, this means that they could produce more goods that could be sold. Therefore, companies become able to open new offices and shops at home and employ more local citizens, not foreigners.
Besides, global stratification uncovers that the US’s level of economic and social development is higher than that of other courtiers. This fact makes the US a desirable place for a destination for immigrants from less prosperous countries. This facilitates the westernization of cultures worldwide because gradually, foreigners adopt the host country’s culture. Still, the growing immigration rates from less developed nations cause social unrest and pressure on the US’s budget. Public discontent happens because those of the newcomers who could not find a job require an unemployment allowance from the government.
To sum up, each country suffers losses and gains benefits because of global stratification and expansion of corporations on foreign nations. Still, one could conclude that the US’s MNCs win more than destination countries. This inference is grounded on the fact that the US is the most economically developed and powerful country. Thus, it could spread its influence on the weaker states and dictate the rules of the game. Global stratification deprives less developed states of the ability to become stronger since more influential ones can control the former nations. The example of Nike proves that domestic companies fail to withstand competition with it and are thus unable to enter the international market. Finally, the US wins more than host countries because they become dependent on working places offered by MNCs, notwithstanding low salaries and poor working conditions.
References
Bergesen, A., & Bata, M. (2002). Global and national inequality: Are they connected? Journal of World-Systems Research, 8(1), 130-144.
Merk, J. (2015). Global outsourcing and socialization of labour: the case of Nike. In K. van der Pijl (Eds.), Handbook of the International Political Economy of Production. Edward Elgar Publishing.
Moran, T., & Oldenski, L. (2016). How offshoring and global supply chains enhance the US economy. Peterson Institute for International Economics, 16(5), 1-7.