The Effect of FDI on Job Separation
Abstract
A novel linked employer-employee data set documents that expanding multinational enterprises retain more domestic jobs than competitors without foreign expansions. In contrast to prior research, a propensity score estimator allows enterprise performance to vary with foreign direct investment (FDI) and shows that the foreign expansion itself is the dominant explanatory factor for reduced worker separation rates. Bounding, concomitant variable tests, and robustness checks rule out competing hypotheses. The finding is consistent with the idea that, given global factor price differences, a prevention of enterprises from outward FDI would lead to more domestic worker separations. FDI raises domestic-worker retention more pronouncedly among highly educated workers and for expansions into distant locations.Download Info
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1864.Length:
Date of creation: 2006
Date of revision:
Handle: RePEc:ces:ceswps:_1864
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Keywords: multinational enterprises; international investment; demand for labor; worker layoffs; linked employer-employee data;Other versions of this item:
- Muendler, Marc A & Becker, Sascha O., 2006. "The Effect of FDI on Job Separation," University of California at San Diego, Economics Working Paper Series qt28h3p82z, Department of Economics, UC San Diego.
- Muendler, Marc-Andreas & Becker, Sascha O., 2007. "The effect of FDI on job separation," Discussion Paper Series 1: Economic Studies 2007,01, Deutsche Bundesbank, Research Centre.
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-01-02 (All new papers)
References
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Olga Bohachova & Bernhard Boockmann & Claudia M. Buch, 2011.
"Labor Demand During the Crisis: What Happened in Germany?,"
IAW Discussion Papers
76, Institut für Angewandte Wirtschaftsforschung (IAW).
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- Muendler, Marc-Andreas & Becker, Sascha O., 2006.
"Margins of Multinational Labor Substitution,"
IZA Discussion Papers
2131, Institute for the Study of Labor (IZA).
- Marc-Andreas Muendler & Sascha O. Becker, 2010. "Margins of Multinational Labor Substitution," American Economic Review, American Economic Association, vol. 100(5), pages 1999-2030, December.
- Marc-Andreas Muendler & Sascha O. Becker, 2009. "Margins of Multinational Labor Substitution," NBER Working Papers 14776, National Bureau of Economic Research, Inc.
- Muendler, Marc-Andreas & Becker, Sascha O., 2006. "Margins of Multinational Labor Substitution," University of California at San Diego, Economics Working Paper Series qt1fc22575, Department of Economics, UC San Diego.
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- Muendler, Marc-Andreas, 2006. "Margins of Multinational Labor Substitution," University of California at San Diego, Economics Working Paper Series qt6b2236xm, Department of Economics, UC San Diego.
- Marc-Andreas Muendler & Sascha O. Becker, 2006. "Margins of Multinational Labor Substitution," CESifo Working Paper Series 1713, CESifo Group Munich.
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