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 reduces the wage elasticity of labour demand. This result is economically important and holds for a number of different specifications.
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Bibliographic InfoPaper provided by School Of Economics, University College Dublin in its series Working Papers with number 200628.
Length: 34 pages
Date of creation: 15 Dec 2006
Date of revision:
labour demand; elasticities; linkages; multinational companies;
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.
- Görg, Holger & Henry, Michael & Strobl, Eric & Walsh, Frank, 2006. "Multinational Companies, Backward Linkages and Labour Demand Elasticities," IZA Discussion Papers 2506, Institute for the Study of Labor (IZA).
- 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
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