Transnational actors have increasingly gained power in international politics. They have become strength that cross the traditional boundaries which set up by nation states and gradually shifted the focus in international politics from old school thoughts of state actors to a much more discursive range of concerns about considerable number of potential actors. This kind of transnational actor is including transnational corporations (TNCs), individuals, international non-governmental organizations (INGOs), and international governmental organizations. The emergence of transnational actors is not new and played a role for centuries, but came into power recently after Second World War. The reason can be attributed to the diminishing concern of traditional military security conflicts and threats among states, instead of growing new types of threat. Besides, the complexity of domestic interests also makes different actors seeking for their own power in international negotiation.
In brief, the shared trait of all the transnational actors is that interactions among different actors are much free. It is no longer relied on the traditional way between governments which state government becomes the headquarters dealing with all international affairs. Instead, actors from society of one country can directly interact and communicate with both government and society of another country. And sometimes it is not necessarily to go through the procedure of its own government.
Specifically to see, for the TNCs, it is an expansion of domestic company to an international level by having subsidiaries in other countries in the desire of exploring cheap labor force, natural resources, or new market and so on. The impacts of TNCs to state government can be summarized into several dimensions. First, TNCs complicate the financial flows and provide possible solutions for companies avoiding financial control from governments. And international trade is not just trade between countries; it also can be intra-firm trade that companies can trade with its subsidiaries. TNCs can escape high taxation by lower its transfer price of trade to its subsidiaries in abroad. In addition, trade of goods is much harder to trace due to the triangulation of trade. In other words, TNCs can export goods to the destination country indirectly by passing through a third country. There is a case happed few years ago that US electronic trash went into China from third countries being renewed and rebuild there, then traded back to the US as new products, even including some spare parts of fight jet. Moreover, TNCs lead to regulatory arbitrage. It means that companies will seek to move its production abroad or increase production in other countries with lower costs and less constrains from their domestic such as environmental and labour rights concerns. However, this can also happened reversely that using TNCs as a signboard and take advantage from its brand...