Stephen Hymer
Encyclopedia
Stephen Herbert Hymer Canadian
economist, was born in Montreal
, and died after a car accident in Shandaken, New York
. His research focused on the activities of multinational
firms, which was the subject of his PhD dissertation The International Operations of National Firms: A Study of Direct Foreign Investment, presented in 1960, but published posthumously in 1976.
In the analysis of the nature and causes of foreign investment, Hymer made a distinction between direct and portfolio investment. After ascertaining that differences in interest rate
s cause portfolio investments, but not direct investments, and that the industrial distribution of the latter is not significantly different from one country to another, as could be expected if their cause was solely differences in profitability, Hymer concluded that direct investments are capital movements associated to international operations of firms. Their goal is to keep control of production. This control allows either to suppress competition
, or appropriate rents derived from advantages like skilled labour, cheap raw materials, access to capital markets or technology
.
Later, Hymer used marxian
language and concepts more explicitly. In a series of articles published in the 1970s, he considered the relationship between nation-states and multinational firms, detailing their role in the creation of an international division of labor
. Hymer argued that this hierarchal division of labor was a macrocosm of the internal division of labor reproduced within the multinational corporation. Hymer did not believe that these firms had become more powerful than nation-states; instead, multinationals were firmly rooted in the major financial centers of the world, and they tended to reinforce existing geographic and spatial boundaries and dependencies. Papers and articles on this and various other topics articles were compiled by Hymer's graduate students from the New School for Social Research in The Multinational Corporation: A Radical Approach. Papers by Stephen Herbert Hymer, published by Cambridge University Press in 1979.
Hymer's theories have strongly influenced other economists, like Cantwell and Dunning
, and were elaborated by Hymer's dissertation advisor, Charles P. Kindleberger
in American Business Abroad, series of lectures published in 1969. The latter played an important role in the posthumous publication of Hymer's dissertation.
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
economist, was born in Montreal
Montreal
Montreal is a city in Canada. It is the largest city in the province of Quebec, the second-largest city in Canada and the seventh largest in North America...
, and died after a car accident in Shandaken, New York
Shandaken, New York
Shandaken is a town in Ulster County, New York, United States. United States. As of the 2000 census, the town had a total population of 3,235. The name is from a native phrase for "land of rapid waters."...
. His research focused on the activities of multinational
Multinational corporation
A multi national corporation or enterprise , is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation...
firms, which was the subject of his PhD dissertation The International Operations of National Firms: A Study of Direct Foreign Investment, presented in 1960, but published posthumously in 1976.
In the analysis of the nature and causes of foreign investment, Hymer made a distinction between direct and portfolio investment. After ascertaining that differences in interest rate
Interest rate
An interest rate is the rate at which interest is paid by a borrower for the use of money that they borrow from a lender. For example, a small company borrows capital from a bank to buy new assets for their business, and in return the lender receives interest at a predetermined interest rate for...
s cause portfolio investments, but not direct investments, and that the industrial distribution of the latter is not significantly different from one country to another, as could be expected if their cause was solely differences in profitability, Hymer concluded that direct investments are capital movements associated to international operations of firms. Their goal is to keep control of production. This control allows either to suppress competition
Competition
Competition is a contest between individuals, groups, animals, etc. for territory, a niche, or a location of resources. It arises whenever two and only two strive for a goal which cannot be shared. Competition occurs naturally between living organisms which co-exist in the same environment. For...
, or appropriate rents derived from advantages like skilled labour, cheap raw materials, access to capital markets or technology
Technology
Technology is the making, usage, and knowledge of tools, machines, techniques, crafts, systems or methods of organization in order to solve a problem or perform a specific function. It can also refer to the collection of such tools, machinery, and procedures. The word technology comes ;...
.
Later, Hymer used marxian
Marxism
Marxism is an economic and sociopolitical worldview and method of socioeconomic inquiry that centers upon a materialist interpretation of history, a dialectical view of social change, and an analysis and critique of the development of capitalism. Marxism was pioneered in the early to mid 19th...
language and concepts more explicitly. In a series of articles published in the 1970s, he considered the relationship between nation-states and multinational firms, detailing their role in the creation of an international division of labor
Division of labour
Division of labour is the specialisation of cooperative labour in specific, circumscribed tasks and likeroles. Historically an increasingly complex division of labour is closely associated with the growth of total output and trade, the rise of capitalism, and of the complexity of industrialisation...
. Hymer argued that this hierarchal division of labor was a macrocosm of the internal division of labor reproduced within the multinational corporation. Hymer did not believe that these firms had become more powerful than nation-states; instead, multinationals were firmly rooted in the major financial centers of the world, and they tended to reinforce existing geographic and spatial boundaries and dependencies. Papers and articles on this and various other topics articles were compiled by Hymer's graduate students from the New School for Social Research in The Multinational Corporation: A Radical Approach. Papers by Stephen Herbert Hymer, published by Cambridge University Press in 1979.
Hymer's theories have strongly influenced other economists, like Cantwell and Dunning
John Harry Dunning
John Harry Dunning, OBE was a British economist. He researched the economics of international direct investment and the multinational enterprise from the 1950s until his death...
, and were elaborated by Hymer's dissertation advisor, Charles P. Kindleberger
Charles P. Kindleberger
Charles Poor "Charlie" Kindleberger was a historical economist and author of over 30 books. His 1978 book Manias, Panics, and Crashes, about speculative stock market bubbles, was reprinted in 2000 after the dot-com bubble. He is well known for hegemonic stability theory.-Life:Kindleberger was born...
in American Business Abroad, series of lectures published in 1969. The latter played an important role in the posthumous publication of Hymer's dissertation.