Neo Liberal Approach and Social Democratic Approach for Transnational Corporations

The primary objective behind this project is to determine whether these approaches ensure that the transnational corporations undertake various mechanisms in the interests of communities and individuals or not. It also aims to exhibit how these approaches ensure the above fact.&nbsp. For determining all these factors, an in-depth analysis is required. The other important objective is to identify the differences between the two approaches and to find out if they have similar strengths or weaknesses.
Prior to the in-depth analysis, it is necessary to understand the three core concepts of this research paper. Neo-Liberalism came into existence in the early 1970s. August Von Hayek and Milton Friedman were awarded Nobel Prize because of their legitimating monetarist neoliberal thoughts. In this regard, David Harvey had stated in his book ‘A History of Neoliberalism’ in 1974 that “a dramatic consolidation of neoliberalism at the national policy level occurred in both the UK and US”. It can be considered as a set of economic policies. During the last 25 years, it has become widespread. The basic characteristic is to expand and intensify the market, through increasing frequency, number, formalization and repeatability of transactions (Web inter, 2005).
The social democratic approach supports gradualism. It believes that the gradual democratic reforms towards the capitalist economies eventually can succeed in forming a socialist economy. Through revolutionary means, it also can reject the forcible imposition. In the second half of the nineteenth century, many parties considered themselves as the social-democratic. In most of these cases, these parties were seeking to introduce socialism along with introducing the democracy, particularly in those nations where democratic institutions were lacking.
Transnational Corporation refers to the companies, operating at the international level. It comprises of those companies that sell products and services internationally or globally. Basically, these companies are dealing with Less Economically Developed Countries (LEDCs) with having branches in the More Economically Developed Countries (MEDCs). Few of the examples of these companies include Nike, Coca-Cola and Sony among others.