2011 - Working Papers: General and International Management

When considering the interactions between Multinational Enterprises (MNEs) and the countries in which they operate, distinction should be made between two kinds of countries: a single "home country" and one or more "host countries". The interests of the MNEs and of their home countries do not necessarily coincide. Indeed, in certain cases they are likely to conflict. The nation state, though, nominally sovereign, may not always be in a position to impose its policies on the MNEs operating within its jurisdiction, even in those cases where the MNEs are considered “nationals". At the same time the state can benefit substantially from the value added activities undertaken by MNEs both within and outside its borders.  The paper examines different aspects of the relationship between the MNEs and their home country and considers their economic effects, as well as some of their public policy implications.