Session 20 – The Impact of Transnational organizations

Transnational Relations and World Politics by Joseph Nye and Robert Keohane explores the impact of transnational organizations on world politics. Transnational organizations include all the multinationals, trade unions, revolutionary movements and all such other organizations that work beyond the control of foreign policy organs of governments. They are able to influence the states, both in their domestic policies and foreign policies. The authors take the view that the international arena is no longer dominated by the actions of states but such transnational organizations should also be considered as vital players because of their sheer size and impact.

These organizations have facilitated the global interactions between different states and people in areas of communication, transportation, finance and travel, so much so that imagining a world without them is very difficult. This has the positive impact of increasing the sensitivities of societies to one another and showing that this could be the path to increased collaboration and hence less or no conflict. At the same time, it has increased dependence between the different players, usually with one actor having more power over the other. An example of this could be the multinationals who yield considerable influence on governments and in many ways confine and limit their freedom because of costs that impose on such governments for taking actions against their interests.

 Another point that the paper raises is that such transnational organizations are used by governments in advancing their foreign policy objectives. For example, the decision by the US to share its nuclear capabilities with India is an example of this. The US uses its multinationals corporations especially in fields of nuclear energy and defense technologies to achieve it policy objectives. While the US may allow the transnational organizations based in the US in such fields to conduct business with India; it may restrict their business activities for other countries, such as Pakistan.

This leads us to conclude that such transnational organizations have both advantages and disadvantages for different players in the international arena. While sometimes these organizations may act on their own but at other times, they may be used by states to achieve their objectives too. The power of states to control such organizations vary with powerful countries usually having more say in the workings and actions of such organizations then weaker states.