Multinational corporations have a significant influence on the formation of the social and economic context in the world. This is because, due to their development, they rely heavily on outsourcing workers. This action makes it possible to provide more jobs and improve lives in developing countries. At the same time, one of the leading consequences of this is the emergence of structural stratification, leading to inequality. Thus, multinational corporations such as Nike have an effect on local culture and the emergence and strengthening of the phenomenon of global stratification in the world.
Before considering the role of corporations in local culture and global stratification, it is necessary to gain an understanding of what Nike is. This organization is a multinational corporation that is engaged in the production of sportswear, shoes, and accessories (Standaert, 2022). It has one of the leading positions in the market and operates all over the world. Due to such global activities, the company requires frequent recruitment of employees through outsourcing. Thus, Nike delegates some operations to third parties in developing countries. Research states that “Nike has 500,000 people worldwide involved in the production and chooses to outsource the work to contractors in the Philippines, Vietnam, China, Indonesia, and Taiwan” (Gallimore, 2021, para. 1). The primary positive influence on the local culture is the provision of jobs for individuals in need and the improvement of their living conditions.
As part of the operation of international companies, it is necessary to consider the phenomenon of global stratification. This aspect implies the emergence of various inequalities in the world, which is its main negative effect. Thus, global stratification contributes to the emphasis on economic differences between countries and people (Fehl & Freistein, 2020). Moreover, it includes inequality of resources, opportunities, and privileges. It is also worth noting that global stratification has a negative impact on local culture, especially in developing countries. This is reflected in the lifestyle of people and their high economic vulnerability. Global stratification provides people with working opportunities which is a significant positive contribution.
The United States of America is affected mainly by global stratification. This is due to the fact that the country is one of the richest and most advanced on the world stage. Global stratification provides companies like Nike, with the outsourcing opportunities that positively affect the economy of developing countries (Choi and Yu, 2019). Therefore, international organizations get the opportunity to expand their activities and get more profit from this action. In addition, the US has the advantage of what earns foreign exchange. On the other hand, a negative consequence is a fact that residents of the United States, due to outsourcing, lose their jobs, which increases the unemployment rate. Consequently, in this situation, the biggest “winner” becomes the country in which the international company like Nike operates.
In conclusion, the global activities of multinational companies are essential not only for their country but also for the economy and culture of other regions. Thus, Nike, resorting to outsourcing in developing countries, contributes to improving the economic situation of residents and reducing the unemployment rate. At the same time, the global stratification caused by this process is negatively reflected in the increase in inequality between residents of different countries. For the United States, this process is advantageous because it promotes business development and increases foreign exchange. At the same time, at the global level, global stratification can be characterized by a significant adverse effect.
References
Choi, J.Y. & Yu, E.S. (2019) International outsourcing, unemployment and welfare: A re-examination. East Asian Economic Review, 23(3), 261-284.
Fehl, C., & Freistein, K. (2020). Organising global stratification: How international organisations (Re) produce inequalities in international society. Global Society, 34(3), 285-303. Web.
Gallimore, D. (2021). Nike’s approach to outsourcing. Outsource accelerator. Web.
Standaert, W. (2021). Product digitalization at Nike: The future is now. Journal of Information Technology Teaching Cases, 12(1), 28-34. Web.