Multinational Corporations and Nation-States: Managing Shared- and Conflicts of Interest

Hany H. MAKHLOUF

Abstract


Abstract. Satisfactory and mutually beneficial relationships between multinational corporations and individual nation-states are sustainable as long as their perceived shared interests exceed any conflicts of interest. However, when events, or actions intentionally taken by either side or dictated by circumstances, alter an acceptable balance between the shared- and conflicts of interest, a good business relationship can deteriorate fast to the detriment of one or both sides. Thus, shared-interests cannot be assumed to continue over the long-range without consistent efforts by both sides to maintain them and, in the meantime, keep conflicts of interest within a tolerable level. This paper explores the factors that contribute to sustaining shared interests and containing conflicts of interest between multinational corporations and nation-states in order to avoid a deteriorations or possible disruption of an otherwise mutually beneficial relationship. Of the questions to be addressed are: what strategies and actions can help in strengthening the shared interests, and what actions and policy changes contribute to an increase in the conflicts of interest between nation-states and multinational corporations?

Keywords. Multinational corporations, Joint interests, Conflict of interest, Host countries, Transfer prices, Profit shifting, Transfer-pricing, Earning stripping.

JEL. F23, G18, G38.


Keywords


Multinational corporations; Joint interests; Conflict of interest; Host countries; Transfer prices; Profit shifting; Transfer-pricing; Earning stripping.

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DOI: http://dx.doi.org/10.1453/jsas.v4i2.1315

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