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The impact on wages, employment and exports of backward linkages between multinational companies and SMEs

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  • Leiva, Juan Carlos
  • Monge Rodríguez, Ricardo
  • Rodríguez-Alvarez, Juan Antonio

Abstract

Policymakers often look for ways to attract foreign direct investment (FDI) by multinational corporations (MNCs). This paper estimates the impact of a programme, Costa Rica Provee, that seeks to increase backward linkages between small and medium-sized enterprises (SMEs) and MNCs in Costa Rica. The impacts were measured by reference to real average wages, employment demand and the probability of exporting, using a combination of fixed effects and propensity score matching with panel data on treated and untreated firms for 2001-2011. Programme beneficiaries evinced higher average wages, labour demand and export probabilities than untreated firms, with dose and duration also having a major influence.

Suggested Citation

  • Leiva, Juan Carlos & Monge Rodríguez, Ricardo & Rodríguez-Alvarez, Juan Antonio, 2017. "The impact on wages, employment and exports of backward linkages between multinational companies and SMEs," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    • Handle: RePEc:ecr:col070:43453
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