Transnational Corporations And Economic Integration Of EU

Integration gradually had become an important phenomenon in world since the World War II. As the same period, the development and extension of the post-war Transnational Corporations (TNCs) became another important economic phenomenon. From the integration process of world economy, we can find that modern international economic integration carried both on micro-level and macro-level and international economic integration was the unity of the two levels. The macro-level of economic integration carries on by countries along to the same areas, in which the factors including trade and capital that hinder the economic connections had been eliminated by policies. Even a super-national coordination organization had been established to coordinate the policies. The micro-level of economic integration carries on by transnational corporations. They will promote and enhance the economic connect and interdependence relations among the countries within the same region through the activities as FDI, international production and transnational trade and so on.Therefore, the transnational corporations are also the important strength that pushs forward the economic integration and economic development in the world. But in a long period the researches for how the transnational corporations influence the conomic integration are not systematic. Owing to this, this paper uses the related theoretical analysis in political economics, international economics, macroscopic and microscopic economics etc. and analyses the behavior of transnational corporations in two levels to show the promotion to European integration by transnational corporations.This paper divides the research on how transnational corporations influence the European economic integration into two levels. Firstly, the paper studys the influence on the political level and how transnational corporations act as a interest groups and lobby to European policy-making body. Secondly, the paper studys the influence from economic level. The paper studys how the transnational corporations strengthen the economic relationship among European countries through the actions such as FDI, intra-firm trade and cross-border M&A etc. In modern society, interest group is a contemporary political power that is widespread existence in society. Firstly, this paper analyzes the unique characteristics of TNCs interest group in European Union. Then the paper further analyzes the special multi-level policy-making mechanism in European Union and the game model of policy-making process. At last, the paper use European Round Table as an example to show the promotion by large TNCs in the of European Integration process.After the World War II, FDI carried by transnational corporations developed quickly in the world. This paper analyzes the FDI from US to European Union countries and the FDI among European countries and points out that the two kinds of FDI both are the main factors which push European industry division transit from vertical labor division among counties to inherent-industry labor division among products. Furthermore, the paper points out that the FDI by TNCs in European countries also helps the establishment of the integration international production systems and use Ford corporation's production in European countries as an example to prove it. At last, the paper points out that the development of FDI among European countries also urges the adjustment of European tax policy and investment policy.After the World War II, intra-firm trade carried on rapidly in the world. At the same time, intra-industry trade came to catch the attention in world trade. This paper analyses the characteristic and innate character of the two kinds of trade terms, and points out the close relationship between them. Because it is difficult to get the intra-firm trade data of European TNCs, the paper use the intra-industry trade data to analyze European trade integration process. The data of intra-industry trade in European countries and the data of intrabloc trade share and trade intensity indices show that the intra-industry trade in European countries increased and the intrabloc trade share and trade intensity indices also increase as the same time. Furthermore, the intra-industry trade in European countries also pushs forward the transition of trade policy from protection trade policy to strategic trade policy.After 80's in 20th century, the FDI by European transnational corporations made a rapid increase and international M&A had a larger proportion in the newly setting up investment of total FDI. Firstly, this paper analyses the characteristics of international M&A among TNCs in European countries. Then, the paper analyses the challenges to European Competitive Policy from this. This paper points out the cross-border M&A promotes the market concentration in European banking industry. The paper also testify the cross-border M&A can accomplish the scale economy through an example of Vodafone and Mannesmann. At last, the successful M&A also can blend the firm culture and the race culture of European countries and strenghen the economic relationship among European countries.The technological standard strategy of the TNC is the importance of its technological strategy. This paper point out the necessity and possibility of TNC owing the technological standard on the bases of economic analyzing to the technological standard. Therefore, the technological standard is of importance both to transnational corporations and to European economic integration. The paper modify the technological standard alliance can establish one technical standard through the establishment of GSM standard as an example. Because of the public nature, technological standard also is the main part of European integration. The transnational corporations contribute to the European economic integration through the participation of technological standards.As a summary, the transnational corporations influence European economic integration not only on politic level also on economic level. Transnational corporations influence the European economic integration process by many kinds of market activities and pushe forward the European integration process.