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MNC: Managing Political Risk

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In lieu of suspending operations, or withdrawing from the country, a MNC will usually take one of two routes to manage political risk: adaptation or dependency. What is adaptation? What is dependency? What are the four characteristics of adaption and dependency?

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Adaptation is when an MNC decides that the political risk in a particular country is relatively low, or when a high risk environment is worth the potential return operations can bring, so the risk is accommodated through adaptation to the political regulatory environment. There are several means through which this can be done: 1) political risks ...

Solution Summary

Adaptation and dependency in political risk both explained on how they can be achieved.