The Wage Premium of Foreign Ownership: Evidence from European Mergers and Acquisitions
AbstractThe authors provide evidence on the impact of foreign ownership on labor market outcomes analyzing pay differences between foreign-acquired and domestically owned firms. For this purpose, they use firm-level data from 16 European countries over the time period 19992006. Combing propensity score matching techniques with difference-in-differences (DID) estimators the authors estimate positive wage premia of cross-border merger and acquisitions (M&As), suggesting that foreign-acquired firms exhibit higher short-run (post-acquisition) wage growth than their domestic counterparts. The observed wage disparities are most pronounced for low paying firms (with average wages below the median) which are typically located in Eastern European transition economies. --
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Bibliographic InfoArticle provided by Kiel Institute for the World Economy in its journal Economics: The Open-Access, Open-Assessment E-Journal.
Volume (Year): 6 (2012)
Issue (Month): 21 ()
foreign Ownership; mergers and acquisitions; wage effects; propensity score matching; difference-in-differences estimator;
Find related papers by JEL classification:
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
- F15 - International Economics - - Trade - - - Economic Integration
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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- Paolo Epifani & Gino Gancia, 2005.
"Openness, government size and the terms of trade,"
Economics Working Papers
915, Department of Economics and Business, Universitat Pompeu Fabra, revised Jan 2008.
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