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Danish Multinationals and Competition between Workers at Different Locations

Author

Listed:
  • Skaksen, Mette Rose

    (The Confederation of Danish Industries)

Abstract

We present a theoretical framework that explains how the wage in one production location in a multinational firm affects labour demand in other production locations through two effects: the relocation effect and the output effect. Second, we use data on Danish multinationals in order to estimate labour demand in the Danish part of these firms. The results indicate a (weak) substitutionary relationships between workers in Denmark and other high-income countries. However, labour demand in the Danish part of the firms seems to be independent of the wage costs in low-income countries.

Suggested Citation

  • Skaksen, Mette Rose, 2003. "Danish Multinationals and Competition between Workers at Different Locations," Nationaløkonomisk tidsskrift, Nationaløkonomisk Forening, vol. 2003(1), pages 187-205.
    • Handle: RePEc:hhs:jdaecn:0203
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    More about this item

    Keywords

    multinational firms; production location; labour demand;
    All these keywords.

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General

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