Why should multinational corporations do


Problem: Diversity in factor endowment, resources, demographic structure, and knowledge acquisition is the main driver for international trade. Cheaper resources attract producers and importers, whereas lack of resources in some countries attract exporters in other countries. International trade might foster the accumulation of wealth, but it does not foster equitable distribution of wealth. According to the US Department of Labor (n.d.), there are 1.5 children in child labor in the cocoa harvesting industry and 50% of them typically experience injury while working. Cocoa beans are mostly produced in African but are processed by Western companies to make chocolate. The majority of cocoa harvesters earn about $1/day (below extreme poverty level). Child labor is an attractive option since children don't have skills (cheaper wages) and have no power to negotiate and/or complain. Does it matter for an international business to learn about what goes into the production of their commodity like the story of the chocolate we eat and enjoy? Why should multinational corporations do their share to make sure their trade practices don't deepen disparities of income, opportunities, and overall well being of people in other nations?

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