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The transfer of workers within multinationals and ownership of foreign affiliates

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  • Lee, Joonhyung

Abstract

We study the variation in ownership shares across affiliates of the same multinational firm. Using the micro-level data on foreign affiliates of South Korean multinationals, we construct a proxy for the headquarter intangible asset using transferred Korean workers from the parent to the affiliate. Our results show a strong relationship with the parent ownership share even after controlling for the parent fixed effect. Our empirical evidence thus extends support for the theory on multinational firm boundaries at the micro-level.

Suggested Citation

  • Lee, Joonhyung, 2014. "The transfer of workers within multinationals and ownership of foreign affiliates," Economics Letters, Elsevier, vol. 125(2), pages 149-152.
    • Handle: RePEc:eee:ecolet:v:125:y:2014:i:2:p:149-152
    DOI: 10.1016/j.econlet.2014.08.026
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    Cited by:

    1. Jae‐Joon Han & Hongshik Lee & Joonhyung Lee, 2019. "The role of foreign affiliate productivity in the integration strategies of multinational firms," The World Economy, Wiley Blackwell, vol. 42(5), pages 1576-1597, May.
    2. Nakamura, Masao & Zhang, Anming, 2018. "Foreign direct investment with host country market structures, with empirical application to Japan," Journal of the Japanese and International Economies, Elsevier, vol. 49(C), pages 43-53.

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    More about this item

    Keywords

    Multinational firm boundaries; Incomplete contract; Ownership; Headquarter intangible asset;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F10 - International Economics - - Trade - - - General
    • F20 - International Economics - - International Factor Movements and International Business - - - General

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