Abstract:
The master thesis aims to examine to what extent the externalization phenomenon (which was originally articulated by German sociologist Stephan Lessenich as a process of transferring costs of production and consumption from rich societies to the rest of the world) is present within European West-East relationship. The master thesis employs the mixed method. By utilizing a panel data econometric analysis, it demonstrates that externalization in EU West-East relationship reveals itself in increasing FDI income payments from Eastern to Western countries and in increasing East-West migration flows. By applying a qualitative method based on a case study of Volkswagen company operating in Central and Eastern Europe, it unfolds the mechanism of externalization, namely the outsourcing of low(er) value added activities to Eastern European subsidiaries within a European West-East joint venture. Current master thesis contributes to the scarce (empirical) literature on the externalization phenomenon and particularly, draws attention to its local European implication that was not elaborated before.
