The Effects of Overseas Operations on Home Employment of Japanese Multinational Enterprises
AbstractThis paper examines the hypothesis that expansion of overseas operations of Japanese manufacturing multinational enterprises (MNEs) reduces home employment. While the existing studies are mainly based on the industry level, this paper presents the evidence using newly constructed firm-level panel data set over the period 1991-2002. In spite of concerns expressed about the adverse effects of FDI on the domestic economy, the evidence does not support the view that overseas operations expand at the cost of home employment in Japan. On the contrary, the findings suggest that overseas operations have somewhat helped to maintaining the level of home employment in Japanese manufacturing during the period under study. However, the results are sensitive to the estimation method used and whether the estimation is based on the panel data set is balanced or unbalanced.
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Bibliographic InfoPaper provided by Institute of Economic Research, Hitotsubashi University in its series Hi-Stat Discussion Paper Series with number d08-251.
Date of creation: Jun 2008
Date of revision:
Multinational Enterprises; FDI; Labour demand; hollowing out of manufacturing; Japan;
Find related papers by JEL classification:
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-06-07 (All new papers)
- NEP-INT-2008-06-07 (International Trade)
- NEP-LAB-2008-06-07 (Labour Economics)
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