Multinationals as Stabilizers?: Economic Crisis and Plant Employment Growth
AbstractThis paper examines the link between multinational enterprises and employment growth at the plant-level. We investigate in detail the comparative response of multinationals and domestic firms to an economic crisis, using the empirical setting of a well defined case of economic slowdown in Chile as a natural experiment. In our empirical analysis we find that employment growth in manufacturing plants has been drastically reduced during the economic crisis. More importantly, we do not find evidence that multinationals react to the economic crisis differently than do domestic firms. Our findings hold in a number of robustness tests, in which we also investigate the role of access to finance. The results are in contrast to the idea that multinationals are less affected by an economic crisis and that they may be able to act as stabilizers in developing countries.
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Bibliographic InfoPaper provided by University of Nottingham, GEP in its series Discussion Papers with number 07/15.
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Multinationals; employment growth; plant survival; economic crisis;
Other versions of this item:
- Alvarez, Roberto & Görg, Holger, 2007. "Multinationals as Stabilizers? Economic Crisis and Plant Employment Growth," IZA Discussion Papers 2692, Institute for the Study of Labor (IZA).
- Roberto Álvarez & Holger Görg, 2007. "Multinationals as Stabilizers?: Economic Crisis and Plant Employment Growth," Working Papers Central Bank of Chile 412, Central Bank of Chile.
- F2 - International Economics - - International Factor Movements and International Business
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
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