Taking Care of Business: Aftercare and the State — Multinational Enterprise Nexus in Wales

Abstract

In this paper the authors examine the nature of relationships between multinational enterprise (MNE) affiliates and local institutions of governance. They begin by identifying a number of key themes regarding the efficacy and nature of local institutional support for the attraction and embedding of MNE affiliates. The growing interest of governments in embedding MNE affiliates begs questions not only of the rational organisation of government as a distinct set of institutions but, more significantly, of the increasingly indistinct boundaries between the state and firms. Governments adopt different stances toward MNEs, and the credibility of these stances rests crucially on some degree of partnership with MNEs at the local level. These partnerships and associated potential for oneway or mutual forms of capture highlight the increasingly politicised nature of the local state—MNE nexus. The authors illustrate these themes through a study of the relationship between local institutions and some of the most important MNEs in Wales—a ‘region’ noted for its proactive stance in the attraction and, more recently, the development of MNE affiliates. Finally, the authors offer some conclusions regarding the increasingly politicised nature of state—MNE relations at the local scale.