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The Wage Premium of Globalisation: Evidence from European Mergers and Acquisitions

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  • Harald Oberhofer
  • Matthias Stöckl
  • Hannes Winner

    (WIFO)

Abstract

We provide evidence on the impact of globalisation on labour market outcomes analysing pay differences between foreign-acquired and domestically-owned firms. For this purpose, we use firm level data from 16 European countries over the time period 1999 to 2006. Applying propensity score matching techniques we estimate positive wage premiums of cross-boarder merger and acquisitions, suggesting that foreign acquired firms exhibit higher short-run (post-acquisition) wages than their domestic counterparts. The observed wage disparities are most pronounced for low paying firms (with average wages below the median). Finally, we find systematic wage premiums in Western European countries, but not so in Eastern Europe.

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Bibliographic Info

Paper provided by WIFO in its series WIFO Working Papers with number 416.

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Length: 17 pages
Date of creation: 10 Jan 2012
Date of revision:
Handle: RePEc:wfo:wpaper:y:2012:i:416

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Keywords: Globalisation; mergers and acquisitions; wage effects; propensity score matching;

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References

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Cited by:
  1. John P. Weche Gelübcke, 2013. "Foreign and Domestic Takeovers in Germany: Cherry-picking and Lemon-grabbing," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 59(4), pages 275-294.
  2. John P. Weche Geluebcke, 2012. "Foreign and Domestic Takeovers in Germany: First Comparative Evidence on the Post-acquisition Target Performance using new Data," Working Paper Series in Economics 249, University of Lüneburg, Institute of Economics.

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