Project Materials


Multinational corporations as a catalyst for nation-building in developing nations.

Multinational corporations as a catalyst for nation-building in developing nations.



This study examined the role of multinational corporations in third-world nation-building ( the Nigeria experience). The study population consists of 200 employees of selected multinational corporations in Lagos state. The researcher utilized questionnaires as the data gathering instrument. Using a descriptive survey research design, this study was conducted. The study utilized 133 HRMs, production managers, administrative workers, and junior employees as respondents. The acquired data were tabulated and evaluated using straightforward percentages and frequencies.


Chapter one


  • Background of the study

Multinational corporations (MNCs) have acquired a variety of names over time, including “transnational enterprise” (corporation) (Poon & Sajarattanochote, 2010, p. 291; UNCTAD, 2002, p. 291), “international corporations” or firms, “global corporations” (Wang, and Chen, 2015, p. 78); and “denationalized corporations” “supranational” and “cosmocorporations” (Kuş Despite varying definitions, there is near consensus among academics that MNCs have existed for decades, dating back to the 18th century, and that they are enterprises with income-generating assets in multiple countries. They include firms with both equity and contractual involvement in more than one country, as businesses have become more dispersed in a knowledge- and technology-driven society in a globalizing world. A general definition of a multinational is an enterprise with some equity investment or contractual involvement in more than one country, including management contracts, franchising, and leasing agreements (see Kuşluvan, 1998, p. 168). The scholarly discourse on MNCs revolves around a variety of topics; however, the focus of this study is on the effects of multinational activities on the skills development of host countries, as illustrated by Nigeria. The headquarters of a typical multinational firm is often located in one country, while other facilities are located in the host country. In certain quarters, a multinational corporation is known as a multinational enterprise (MNE) or transnational corporation (TNC) (Tatum, 2010). They invade host countries using various methods and strategies. Some companies test the market by exporting their products to determine whether existing products can capture a substantial market share. These businesses rely heavily on export agencies. These overseas sales branches or assembly operations are developed to reduce transportation expenses. Due to tariff obstacles and restrictions, there is a limit to what a company’s foreign exports can accomplish. The majority of businesses are motivated by low wage rates and other environmental conditions.


In the past three to four decades, the world has witnessed the expansion of the multinational corporation as an economic phenomena (MNC). According to Hicks and Gullet (1981), multinational corporations engage in international commerce through exporting, licensing, franchising, joint ventures, foreign branches, or wholly-owned subsidiaries. While the MNC is not a new phenomenon, its significance, strength, and implications have only recently been properly recognized. Consider, for example, the major significance that multinational oil companies play in the economic systems of the world and Nigeria in particular. Hear what former Managing Director (MD) of NNPC L.A. Amu said about the Nigerian economy in order to drive home the point. The Nigerian economy consists primarily of a robust petroleum industry placed atop an underdeveloped manufacturing base. This is evidence of the favorable effect multinational oil companies play in the Nigerian economy. Without oil corporations, the oil and petroleum sector would not have existed in the first place. According to Megginson et al. (1988), multinational corporations have social and even political repercussions in their host nations in addition to their economic effects. KINARD (1985) did not concur with this viewpoint when he stated that large firms, such as multinational corporations (MNC), play not only economic functions but also significant political and social roles in their environs. Multinational business has its own characteristics for obvious reasons. It involves multiple nations. Consequently, it is influenced by several environmental conditions in these nations. Consequently, international business management and multinational management are both peculiar and difficult. Managers of multinational corporations must devise or establish distinct policies and strategies in order to thrive in each setting. Despite the fact that it is the role of a country’s government, such as Nigeria’s, to imitate programmes and activities for socioeconomic growth and development, governments’ resources are frequently insufficient to fulfill these responsibilities efficiently. Megginson and colleagues (1988) assert the “Multinational corporations are more than just enormous economic units. In many instances, they are practically a kind of government, being wealthier and more powerful than a number of the nations in which they operate. In a typical year, the combined sales of Exxon, General Motors, and Royal Dutch Shell Group exceeded the gross national product of the majority of the world’s developed nations. Therefore, it is not unreasonable for society to demand and press multinational corporations to play a crucial role in the socioeconomic growth of their host countries. Even if for no other reason, they should strive to fulfill their corporate social responsibilities. According to Meginson et al. (1988), this is the case. International business firms of today are expected to contribute to the economic growth and development of the host nation as well as generate profits for their owners. What they are suggesting is that multinational corporations should not be solely concerned with profit maximization in their host countries, but should also assume other tasks that would help society. Many individuals have lauded multinational corporations as agents of social, economic, and technological development in their home nations. Others, however, view MNCs as tools of exploitation in their host countries. These two perspectives are based on the extent to which MNCs have met societal and business expectations and demands in their respective environments.


Statement of the problem


However, the role of multinational corporations also includes a contribution to government revenue through the payment of corporate tax, the non-statutory role that they sometimes play as a public relations effort to come across as good corporate citizens, community, a contribution to foreign exchange earnings through export drives or the provision of some infrastructure e.g. schools, health services, etc., a reduction in unemployment issues and in income distribution equality, and an improvement in the quality of life. These results are possible due to the vast resources available to multinational corporations in their operations across national borders, and they will be of immense benefit to nations that have developed policies and enacted laws and regulations to control and attract these corporations and their investment.


Objective of the study


The study’s aims are as follows:


Determine if multinational corporations in Nigeria demonstrate social responsibility.

Examining the role of multinational firms in Nigeria’s economic progress.

Determine the elements influencing the expansion and success of multinational corporations in Nigeria.

Determine the function of multinational corporations in nation building

Research hypotheses


The researcher formulated the following research hypotheses for the successful completion of the study:


There is no role for international firms in Nigeria’s economic growth.


Multinational firms contribute to the economic progress of Nigeria.


There are no elements in Nigeria that influence the growth and success of multinational corporations.


There are elements influencing the expansion and success of multinational corporations in Nigeria.


Significance of the study


This research will be of considerable importance since it will shed light on the true involvement of multinational corporations in Nigeria. It will demonstrate if they are beneficial or detrimental to the nation. Government and MNC management will find the information beneficial for future development planning. Additionally, not only social researchers, environmentalists, but also students in international business management and academicians in general will benefit from this publication.


Scope and limitation of the study


The scope of the study is multinational corporations as nation-building catalysts in third world nations (the Nigeria experience). The researcher faces a constraint that restricts the study’s scope;


a) AVAILABILITY OF RESEARCH MATERIAL: The researcher has insufficient research material, consequently limiting the scope of the investigation.

b) TIME: The time allotted for the study does not allow for a broader scope because the researcher must mix it with other academic activities and examinations.



Multinational corporations (MNCs): MNCs and multinational management. Kinard (1988) defined multinational corporations (MNCs) as companies that create and market goods and services in many nations. Such companies include Shell, UTC, Royal Dutch, Coca-Cola, etc.


Economic development: – A phrase used to characterize the growth of a country’s aggregate output and per capita output.

Multinational corporations as a catalyst for nation-building in developing nations.



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