The Comparative Effectiveness of the World Bank and MNE’s on Developing Countries (Trade and Development)
Despite the fact that international trade theory contends that trade is supposed to make all nations better off, many and especially the developing nations themselves have argued that there is an inherent bias in the international trading system which has blocked economic development and export opportunities for many developing countries. These biases include an external factor such as developed nations’ restrictive trade policy (primarily agricultural policy) towards developing nations and its own internal factors that limit economic growth and capability such as corruption, low level of education, and for a majority dependency on primary products. To make up for the obstacles developing nations face in the international trade system, advanced nations have attempted to help developing nations through setting up institutions such as the World Bank, which despite the money to fund economic reforms has either succeeded or failed to promote economic growth due to external factors out of its’ control mainly political corruption and economic growth within countries. A more controversial actor that has helped developing nations are Multinational Enterprises (MNE). The benefits of Multinational Enterprises on countries has been hotly debated as critics claim that their primary interest in developing nations is to save money and find more lenient environmental standards to abide by. However, research has shown that Multinational Enterprises have been able to stimulate a flow of capital and knowledge into developing nations and at the same time keep its funds from the hands of corrupt politicians. Despite their va ...