Better Pay and Working Conditions in Multinational Essay

Reaction Paper Part I Identification Alexander Hijzen and Paul Swaim, Do multinationals professionalmote break up remunerate and running(a) conditions? OECD (Organization for economic Development) Observer, October 2008 Issue 269, pp 15 17. Part II arise Summary The condition examines the behavior of international business enterprises, also cognize as multinational enterprises (MNEs), wages and working conditions, from the perception of the Organization for Economic Development (OECD).It gives a basic definition of a MNE as a corporation with headquarters in one country and affiliates, subsidiaries or integrated operations in one or several other countries. mannikin MNEs mentioned in the article include Coca-Cola, Nike, Microsoft, EDF (French energy company), Rio Tinto (British-Australian mining firm), and Toyota. The article notes that there are thousands of MNEs and that they all are not a emblem of Western economic dominance. Some of the top firms listed now in FT one of the UKs top international business magazines includes China, Russia, India, and Brazil.First, the article addresses the pro and con opinions that supporters and opponents of globalization bring to the working table of MNEs. It stresses the fact that no matter what ones opinion may be, the role of the MNEs in the world economy will continue to grow. Next, the article discusses the nature of MNEs as well as notes their advantages on employment (wages and working conditions). Concerning the wages, the article mentions that MNEs technical expertise and modern management styles would provide a basis for higher(prenominal) hand wages.However, the pessimists doubt the higher pay since the MNEs are typically in a strong bargaining position with topical anaesthetic workers. The article explains that the top hat way to answer the question do multinational promote better pay and working conditions was to present a comparison of local and strange companies in terms of their labor pract ices. So a study was accomplished to report on this question. The study showed that MNEs do tend to pay much than local firms that compete in the same markets. In general the pay is 40% higher.The study also noted that the pay may be higher to minimize worker turnover and reduce monitoring cost. These results were ground upon the report focusing on three OECD countries (Germany, Portugal, and the UK) and two emerging economies (Brazil and Indonesia). indeed the author presented the results from the study of those newly hired workers pay vs. those workers who moved from a domestic to a foreign-owned firm, as well as their adjustments to labor practices/working conditions. The study showed higher wages for newly hired workers and small losings or no effect for those moving to foreign firms.Several preceding studies were mentioned which noted that multinational tend to adapt to local practices rather than reduce their own. Finally, the author expresses the effect that experience d managers have on MNEs. It has been proven that local firms that recruit managers with experience in multinationals enjoy higher productivity. They can more easily recognize and enforce internationally accepted labor standards. In the end, it is noted that not only experienced managers but also government support is what will help the MNEs be productive and help development.