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Effects of hiring former employees of multinationals in the absorptive capacity of local firms

Author

Listed:
  • Juan Carlos Leiva

    (Tecnológico de Costa Rica, Costa Rica)

  • Juan Antonio Rodríguez Álvarez

    (Tecnológico de Costa Rica, Costa Rica)

  • Ricardo Monge González

    (Universidad de Costa Rica, Costa Rica)

Abstract

Attracting Foreign Direct Investment seeks, among other goals, increase productivity of local firms through knowledge spillovers. Nevertheless the empirical evidence is contradictory. One influential factor is the absorptive capacity of local firms. This article analyzes the effect of the presence of ex-employees of multinational companies, as employees of local firms in the absorption capacity of these firms. The study was conducted in Costa Rica, a country recognized for its successful strategy in this area. The data come from a survey of 1,167 companies conducted by the Costa Rican Observatory of Small and Mediums Enterprises in 2011. It was found that hiring former employees of multinational companies by local firms has a positive effect on the rate of absorption capacity. In short, this engagement of former employees of multinationals increases by nine percentage points the rate of absorption capacity, with differences for sectors and firms sizes.

Suggested Citation

  • Juan Carlos Leiva & Juan Antonio Rodríguez Álvarez & Ricardo Monge González, 2017. "Effects of hiring former employees of multinationals in the absorptive capacity of local firms," Contaduría y Administración, Accounting and Management, vol. 62(2), pages 36-37, Abril-Jun.
    • Handle: RePEc:nax:conyad:v:62:y:2017:i:2:p:36-37
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    References listed on IDEAS

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    1. Brian J. Aitken & Ann E. Harrison, 2022. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 6, pages 139-152, World Scientific Publishing Co. Pte. Ltd..
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    More about this item

    Keywords

    Absorption capacity; Multinationals companies; SME; Knowledge spillovers; Costa Rica;
    All these keywords.

    JEL classification:

    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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