Multinational Companies, Backward Linkages and Labour Demand Elasticities
AbstractThis paper investigates the link between nationality of ownership and wage elasticities of labour demand at the level of the plant. In particular, we examine whether labour demand in multinationals becomes less elastic with respect to the wage if the plant has backward linkages with the local economy. Our empirical evidence, based on a rich plant level dataset, shows that the extent of local linkages indeed generally reduces the wage elasticity of labour demand. This result is economically important and holds for a number of different specifications.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2506.
Length: 32 pages
Date of creation: Dec 2006
Date of revision:
Publication status: published in: Canadian Journal of Economics / Revue canadienne d'économique, 2009, 42( 1), 332-348
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Holger Görg & Michael Henry & Eric Strobl & Frank Walsh, 2009. "Multinational companies, backward linkages, and labour demand elasticities," Canadian Journal of Economics, Canadian Economics Association, vol. 42(1), pages 332-348, February.
- Holger GÃ¶rg & Michael Henry & Eric Strobl & Frank Walsh, 2006. "Multinational Companies, Backward Linkages and Labour Demand Elasticities," Working Papers, School Of Economics, University College Dublin 200628, School Of Economics, University College Dublin.
- 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
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Smarzynska, Beata K., 2002.
"Does foreign direct investment increase the productivity of domestic firms : in search of spillovers through backward linkages,"
Policy Research Working Paper Series
2923, The World Bank.
- Beata Smarzynska Javorcik, 2004. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages," American Economic Review, American Economic Association, vol. 94(3), pages 605-627, June.
- Beata K. Smarzynska, 2003. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers through Backward Linkages," William Davidson Institute Working Papers Series 548, William Davidson Institute at the University of Michigan.
- Arellano, Manuel & Bond, Stephen, 1991.
"Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations,"
Review of Economic Studies, Wiley Blackwell,
Wiley Blackwell, vol. 58(2), pages 277-97, April.
- Tom Doan, . "RATS program to replicate Arellano-Bond 1991 dynamic panel," Statistical Software Components RTZ00169, Boston College Department of Economics.
- Holger GÃ¶rg & Frances Ruane, 2000. "An Analysis of Backward Linkages in the Irish Electronics Sector," The Economic and Social Review, Economic and Social Studies, Economic and Social Studies, vol. 31(3), pages 215-235.
- Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2014.
"The Own-Wage Elasticity of Labor Demand: A Meta-Regression Analysis,"
IZA Discussion Papers
7958, Institute for the Study of Labor (IZA).
- Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2014. "The own-wage elasticity of labor demand: A meta-regression analysis," ZEW Discussion Papers 14-016, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Hijzen, Alexander & Swaim, Paul, 2010.
"Offshoring, labour market institutions and the elasticity of labour demand,"
European Economic Review,
Elsevier, vol. 54(8), pages 1016-1034, November.
- Alexander Hijzen & Paul Swaim, . "Offshoring, Labour Market Institutions and the Elasticity of Labour Demand," Discussion Papers 08/05, University of Nottingham, GEP.
- Olivier Godart & Holger Görg & David Greenaway, 2013.
"Domestic multinationals, foreign affiliates, and labour demand elasticities,"
Review of World Economics (Weltwirtschaftliches Archiv),
Springer, vol. 149(4), pages 611-630, December.
- Godart, Olivier & Görg, Holger & Greenaway, David, 2012. "Domestic Multinationals, Foreign Affiliates, and Labour Demand Elasticities," IZA Discussion Papers 7061, Institute for the Study of Labor (IZA).
- Jaanika Meriküll & Tairi Rõõm, . "Are foreign-owned firms different ? Comparision of employment volatility and elasticity of labour demand," Bank of Estonia Working Papers wp2014-1, Bank of Estonia.
- Patrick Paul Walsh & Ciara Whelan, 2011. "Mr Whitaker and Industry: Setting the Record Straightâ€“A Reply to Barry and Daly," The Economic and Social Review, Economic and Social Studies, Economic and Social Studies, vol. 42(2), pages 169â€“175.
- Buch, Claudia M. & Lipponer, Alexander, 2010.
"Volatile multinationals? Evidence from the labor demand of German firms,"
Elsevier, vol. 17(2), pages 345-353, April.
- Buch, Claudia M. & Lipponer, Alexander, 2007. "Volatile multinationals? Evidence from the labor demand of German firms," Discussion Paper Series 1: Economic Studies 2007,22, Deutsche Bundesbank, Research Centre.
- Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2014.
"Exporting and labor demand: Micro-level evidence from Germany,"
ZEW Discussion Papers
14-013, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2013. "Exporting and Labor Demand: Micro-Level Evidence from Germany," IZA Discussion Papers 7494, Institute for the Study of Labor (IZA).
- Andreas Lichter & Andreas Peichl & Sebastian Siegloch, 2014. "Exporting and Labor Demand: Micro-level Evidence from Germany," CESifo Working Paper Series 4668, CESifo Group Munich.
- Katariina Nilsson Hakkala & Fredrik Heyman & Fredrik Sjöholm, 2010. "Multinationals, skills, and wage elasticities," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 146(2), pages 263-280, June.
- Hakkala, Katariina & Heyman, Fredrik & SjÃ¶holm, Fredrik, 2007. "Cross-Border Acquisitions, Multinationals and Wage Elasticities," Working Paper Series, Research Institute of Industrial Economics 709, Research Institute of Industrial Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.