Multinational firms are often seen as controlling the secrets of industrial success, and conversely, as causing industrial decline. As a consequence their activites are the subject of intense debate. This study assesses the role of multinational enterprise in international competition - including trade and technology licensing - and analyses the profound implications that follow for policy formulation. This is the first book to use a systematic comparative approach, in which the experience of five major developed economies, the USA, Japan, the UK, Sweden and West Germany, are appraised using the framework of modern economic theory.