A Research On Virtualization Of Multinational Corporation Based On Transaction Costs

With economic globalization and the development of the information technology, transnational corporations achieve the rapid development, and the foreign direct investment doubles scale, so they play an important role in the global economy. As the international industrial restructuring, product life cycles get shorter and shorter; the technological innovation is accelerating; and the international market get increasingly fiercely competitive. The traditional inner business model of production, which are "large" and "small", has been unable to meet the requirements of the development of international markets. In order to remain invincible in the international competition, the transnational corporations need to change existing production and business models to meet the demands of international market development. According to their competitive advantages, more and more transnational corporations begin to combine other enterprises to forge an alliance in the virtualization business model. From the perspective of transaction costs theory, this dissertation discusses the virtual boundary, and with practice, investigates the virtual level of multinational companies.Firstly, this dissertation describes the characteristics and the theory of transnational corporations and virtual enterprises, and analyses the virtual model of the transnational corporations. Secondly, it sums up the motivation of virtualization through analysis of transaction costs cause and the dynamic analysis of the multinational border and scale from transaction costs. And then it brings up the estimation criterion of the virtualization by comparing the internalization and the virtualization of multinational corporations. Finally, it empirically studies on the big multinational corporations, and proves how the transaction costs affects transnational virtualization, and the virtual technology level.