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The labor market effects of foreign-owned firms

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  • Rita Almeida

Abstract

Foreign firms often have a more educated workforce and pay higher wages than domestic firms. This does not necessarily imply that foreign ownership translates into higher demand for educated workers or higher wages, since foreign investment may be guided by unobservable firm characteristics correlated with the demand for educated workers or wages. The author examines foreign acquisitions of domestic firms in Portugal in the 1990s and finds small changes in the workforce skill composition and wages following acquisition. Foreign investors"cherry pick"domestic firms that are already very similar to the group of existing foreign firms.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3300.

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Date of creation: 01 May 2004
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Handle: RePEc:wbk:wbrwps:3300

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Keywords: Environmental Economics&Policies; Small and Medium Size Enterprises; Small Scale Enterprise; Labor Policies; Microfinance; Private Participation in Infrastructure; Small Scale Enterprise; Environmental Economics&Policies; Trade and Regional Integration; Microfinance;

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