MULTINATIONALS CLOSING SUBSIDARIES: THE SOCIAL AND POLITICAL CONSEQUENCES OF ECONOMIC DECISIONS

Abstract

Through a careful historical analysis of two plant closures in the 1970 s, this article addresses
the social and political consequences of multinationals’ disinvestment decisions. The first case
study investigates the decision of Alusuisse, a Swiss multinational in the aluminum sector, to
close its facilities in the region of Venice in Italy. The second case study analyses the decision of
Firestone, a US-based multinational specialized in tires production, to close its Swiss subsidiary
in the Canton of Baselland. Despite the rhetoric of economic necessity, these decisions both
created substantial social outcry and political turmoil, even at national level. The article shows
that microeconomic decisions of disinvestment taken by multinationals can generate chain
reactions that are not entirely predictable and that can have significant influence on the economy
of the host country and the prevailing system of industrial relations