Abstract

In a globalized world nation state governments are no longer able to control the behaviour of global economic actors via legislation and execution. At the same time transnational organizations such as the UN, the ILO or the WTO have not yet established a suitable world order for the global economy. Critics of globalization raise concerns that in many countries multinational firms and their suppliers do not comply to human rights or to social and environmental standards. At the same time, local governments do not enforce these standards and transnational organizations are not allowed to intervene because of the principle of sovereignity. In the present paper I analyse the conclusions that can be drawn from economic free trade theory and from postmodern philosophy concerning the behaviour of multinational firms in developing countries. Despite their paradigmatical differences both these approaches come to similar results.