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Foreign Ownership and Labour in Sub‐Saharan African Firms

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Listed:
  • Neil Foster‐McGregor
  • Anders Isaksson
  • Florian Kaulich

Abstract

We examine whether foreign‐owned firms pay higher wages and have higher employment than domestically owned firms using survey data from 19 sub‐Saharan African (SSA) countries. Our results indicate that foreign‐owned firms pay higher average wages than domestically owned firms, with the wage premium found to be higher for white‐collar workers. We find little evidence of a positive employment effect of foreign ownership, though the evidence suggests a positive employment effect of Chinese ownership on workers in manufacturing.

Suggested Citation

  • Neil Foster‐McGregor & Anders Isaksson & Florian Kaulich, 2015. "Foreign Ownership and Labour in Sub‐Saharan African Firms," African Development Review, African Development Bank, vol. 27(2), pages 130-144, June.
    • Handle: RePEc:bla:afrdev:v:27:y:2015:i:2:p:130-144
    DOI: 10.1111/1467-8268.12129
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    1. Brian Aitken & Ann Harrison & Robert E. Lipsey, 2022. "Wages and foreign ownership A comparative study of Mexico, Venezuela, and the United States," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 4, pages 61-87, World Scientific Publishing Co. Pte. Ltd..
    2. Magnus Blomström & Ari Kokko & Mario Zejan, 2000. "Multinational Corporations and Spillovers," Palgrave Macmillan Books, in: Foreign Direct Investment, chapter 8, pages 101-133, Palgrave Macmillan.
    3. Zadia M. Feliciano & Robert E. Lipsey, 1999. "Foreign Ownership and Wages in the United States, 1987 - 1992," NBER Working Papers 6923, National Bureau of Economic Research, Inc.
    4. Blomstrom, Magnus & Kokko, Ari, 1998. "Multinational Corporations and Spillovers," Journal of Economic Surveys, Wiley Blackwell, vol. 12(3), pages 247-277, July.
    5. Roger Bandick & Patrik Karpaty, 2007. "Foreign Acquisition and Employment Effects in Swedish Manufacturing," Discussion Papers 07/35, University of Nottingham, GEP.
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    Cited by:

    1. Simplice Asongu & Lieven De Moor, 2015. "Financial globalisation and financial development in Africa: assessing marginal, threshold and net effects," Working Papers of the African Governance and Development Institute. 15/040, African Governance and Development Institute..
    2. Sotiris Blanas & Adnan Seric & Christian Viegelahn, 2019. "Job Quality, FDI and Institutions in Sub-Saharan Africa: Evidence from Firm-Level Data," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(5), pages 1287-1317, December.
    3. Simplice A. Asongu & Pritam Singh & Sara Le Roux, 2018. "Fighting Software Piracy: Some Global Conditional Policy Instruments," Journal of Business Ethics, Springer, vol. 152(1), pages 175-189, September.
    4. Galina Besstremyannaya & Sergei Golovan, 2019. "Reconsideration of a simple approach to quantile regression for panel data: a comment on the Canay (2011) fixed effects estimator," Working Papers w0249, Center for Economic and Financial Research (CEFIR).
    5. Asongu, Simplice A., 2017. "Assessing marginal, threshold, and net effects of financial globalisation on financial development in Africa," Journal of Multinational Financial Management, Elsevier, vol. 40(C), pages 103-114.
    6. Abegaz, Melaku & Nene, Gibson, 2022. "Export agglomeration economies in Sub-Saharan Africa manufacturing and service sectors," The Quarterly Review of Economics and Finance, Elsevier, vol. 84(C), pages 40-51.
    7. Livini Donath & Oliver Morrissey & Trudy Owens, 2021. "Pay period and the distributional effect of education on earnings: Evidence from recentered influence function," Discussion Papers 2021-02, University of Nottingham, CREDIT.
    8. Ahmed Fayez Abdelgouad & Christian Pfeifer & John P Weche Gelübcke, 2015. "Ownership structure and firm performance in the Egyptian manufacturing sector," Economics Bulletin, AccessEcon, vol. 35(4), pages 2197-2212.
    9. Amendolagine, Vito & Prota, Francesco, 2021. "Bilateral investment treaties and backward linkages in Sub-Saharan Africa," International Economics, Elsevier, vol. 165(C), pages 172-185.
    10. Rod Falvey & Neil Foster-McGregor, 2017. "Heterogeneous effects of bilateral investment treaties," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(4), pages 631-656, November.
    11. Galina Besstremyannaya & Sergei Golovan, 2019. "Reconsideration of a simple approach to quantile regression for panel data: a comment on the Canay (2011) fixed effects estimator," Working Papers w0249, New Economic School (NES).

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    More about this item

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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