IDEAS home Printed from https://ideas.repec.org/a/spr/weltar/v154y2018i2d10.1007_s10290-017-0304-2.html
   My bibliography  Save this article

Multinationals, competition and productivity spillovers through worker mobility

Author

Listed:
  • Katariina Nilsson Hakkala

    (Aalto University)

  • Alessandro Sembenelli

    (University of Torino)

Abstract

Multinational firms are believed to impact the productivity of domestic firms through worker mobility. Fosfuri et al. (J Int Econ 53:205–222, 2001) suggest that worker mobility and technological spillovers are more likely to materialize when the local and the multinational firm do not compete fiercely in the product market. We assess empirically the importance of the hypothesis by using the Finnish longitudinal employer–employee data. Consistent with the predictions of the model, we find that competition is negatively related to worker mobility but only in high-tech industries where productivity spillovers are present. Thus, our results detail a channel through which competition may negatively affect the productivity of purely domestic firms .

Suggested Citation

  • Katariina Nilsson Hakkala & Alessandro Sembenelli, 2018. "Multinationals, competition and productivity spillovers through worker mobility," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 154(2), pages 401-426, May.
    • Handle: RePEc:spr:weltar:v:154:y:2018:i:2:d:10.1007_s10290-017-0304-2
    DOI: 10.1007/s10290-017-0304-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10290-017-0304-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10290-017-0304-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Thomas, Jonathan M, 1996. "On the Interpretation of Covariate Estimates in Independent Competing-Risks Models," Bulletin of Economic Research, Wiley Blackwell, vol. 48(1), pages 27-39, January.
    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. Pedro S. Martins, 2011. "Paying More To Hire The Best? Foreign Firms, Wages, And Worker Mobility," Economic Inquiry, Western Economic Association International, vol. 49(2), pages 349-363, April.
    4. Castillo, Victoria & Figal-Garone, Lucas & Maffioli, Alessandro & Rojo, Sofia & Stucchi, Rodolfo, 2016. "The Effects of Knowledge Spillovers through Labor Mobility," MPRA Paper 69141, University Library of Munich, Germany.
    5. Holger Görg & Eric Strobl, 2016. "Spillovers from Foreign Firms through Worker Mobility: An Empirical Investigation," World Scientific Book Chapters, in: MULTINATIONAL ENTERPRISES AND HOST COUNTRY DEVELOPMENT, chapter 13, pages 243-259, World Scientific Publishing Co. Pte. Ltd..
    6. Kaiser, Ulrich & Kongsted, Hans Christian & Rønde, Thomas, 2015. "Does the mobility of R&D labor increase innovation?," Journal of Economic Behavior & Organization, Elsevier, vol. 110(C), pages 91-105.
    7. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-1297, November.
    8. Jennifer P. Poole, 2013. "Knowledge Transfers from Multinational to Domestic Firms: Evidence from Worker Mobility," The Review of Economics and Statistics, MIT Press, vol. 95(2), pages 393-406, May.
    9. Amy Jocelyn Glass & Kamal Saggi, 2002. "Multinational Firms and Technology Transfer," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(4), pages 495-513, December.
    10. Daniel A. Ackerberg & Kevin Caves & Garth Frazer, 2015. "Identification Properties of Recent Production Function Estimators," Econometrica, Econometric Society, vol. 83, pages 2411-2451, November.
    11. Fosfuri, Andrea & Motta, Massimo & Ronde, Thomas, 2001. "Foreign direct investment and spillovers through workers' mobility," Journal of International Economics, Elsevier, vol. 53(1), pages 205-222, February.
    12. Mika Maliranta & Pierre Mohnen & Petri Rouvinen, 2009. "Is inter-firm labor mobility a channel of knowledge spillovers? Evidence from a linked employer--employee panel," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 18(6), pages 1161-1191, December.
    13. Philippe Aghion & Nick Bloom & Richard Blundell & Rachel Griffith & Peter Howitt, 2005. "Competition and Innovation: an Inverted-U Relationship," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(2), pages 701-728.
    14. Pierpaolo Parrotta & Dario Pozzoli, 2012. "The effect of learning by hiring on productivity," RAND Journal of Economics, RAND Corporation, vol. 43(1), pages 167-185, March.
    15. Beata Smarzynska Javorcik, 2004. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages," American Economic Review, American Economic Association, vol. 94(3), pages 605-627, June.
    16. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    17. Ragnhild Balsvik, 2011. "Is Labor Mobility a Channel for Spillovers from Multinationals? Evidence from Norwegian Manufacturing," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 285-297, February.
    18. Nickell, Stephen J, 1996. "Competition and Corporate Performance," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 724-746, August.
    19. Kaiser, Ulrich & Kongsted, Hans Christian & Rønde, Thomas, 2011. "Labor Mobility, Social Network Effects, and Innovative Activity," IZA Discussion Papers 5654, Institute of Labor Economics (IZA).
    20. Andrey Stoyanov & Nikolay Zubanov, 2012. "Productivity Spillovers across Firms through Worker Mobility," American Economic Journal: Applied Economics, American Economic Association, vol. 4(2), pages 168-198, April.
    21. Bellemare, Marc F. & Masaki, Takaaki & Pepinsky, Thomas B., 2015. "Lagged Explanatory Variables and the Estimation of Causal Effects," MPRA Paper 62350, University Library of Munich, Germany, revised 23 Feb 2015.
    22. Blomstrom, Magnus & Kokko, Ari, 1998. "Multinational Corporations and Spillovers," Journal of Economic Surveys, Wiley Blackwell, vol. 12(3), pages 247-277, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Simon Falck, 2016. "Foreign-to-domestic labour mobility in Sweden," Regional Science Policy & Practice, Wiley Blackwell, vol. 8(3), pages 111-125, August.
    2. Thanh Le & Ngoc Vu Bich & Sau Mai & Ha Nguyen & Hung Bui, 2023. "Financial Development and International R&D Spillovers Through Trade: Evidence From Developing Countries," SAGE Open, , vol. 13(1), pages 21582440231, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Serafinelli, Michel, 2013. "Good Firms, Worker Flows and Productivity," MPRA Paper 49055, University Library of Munich, Germany, revised 12 Aug 2013.
    2. Jaan Masso & Priit Vahter, 2016. "Knowledge Transfer From Multinationals Through Labour Mobility: Learning From Export Experience," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 99, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    3. Zsolt Csáfordi & László Lőrincz & Balázs Lengyel & Károly Miklós Kiss, 2020. "Productivity spillovers through labor flows: productivity gap, multinational experience and industry relatedness," The Journal of Technology Transfer, Springer, vol. 45(1), pages 86-121, February.
    4. Cristina Jude, 2016. "Technology Spillovers from FDI. Evidence on the Intensity of Different Spillover Channels," The World Economy, Wiley Blackwell, vol. 39(12), pages 1947-1973, December.
    5. Mühlen, Henning, 2013. "Firm-Level Productivity Spillovers from FDI in Latin American Countries," IEE Working Papers 196, Ruhr University Bochum, Institute of Development Research and Development Policy (IEE).
    6. Marino, Marianna & Parrotta, Pierpaolo & Pozzoli, Dario, 2016. "Educational diversity and knowledge transfers via inter-firm labor mobility," Journal of Economic Behavior & Organization, Elsevier, vol. 123(C), pages 168-183.
    7. Stoyanov, Andrey & Zubanov, Nikolay, 2014. "The distribution of the gains from spillovers through worker mobility between workers and firms," European Economic Review, Elsevier, vol. 70(C), pages 17-35.
    8. Cole, Matthew A. & Elliott, Robert J.R. & Strobl, Eric, 2008. "The environmental performance of firms: The role of foreign ownership, training, and experience," Ecological Economics, Elsevier, vol. 65(3), pages 538-546, April.
    9. Bastian Stockinger & Katja Wolf, 2019. "The Productivity Effects of Worker Mobility Between Heterogeneous Firms," German Economic Review, Verein für Socialpolitik, vol. 20(4), pages 492-522, November.
    10. B. Merlevede & K. Schoors, 2006. "FDI and the Consequences Towards more complete capture of spillover effects," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 06/372, Ghent University, Faculty of Economics and Business Administration.
    11. Orlic, Edvard & Hashi, Iraj & Hisarciklilar, Mehtap, 2018. "Cross sectoral FDI spillovers and their impact on manufacturing productivity," International Business Review, Elsevier, vol. 27(4), pages 777-796.
    12. Köllö, János & Boza, István & Balázsi, László, 2021. "Wage gains from foreign ownership: evidence from linked employer-employee data," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55, pages 1-3.
    13. Marijke J. D. Bos & Gonzague Vannoorenberghe, 2018. "Total factor productivity spillovers from trade reforms in India," Canadian Journal of Economics, Canadian Economics Association, vol. 51(2), pages 549-606, May.
    14. Vadym Volosovych & Carolina Villegas Sanchez & Bent Sorensen & Sebnem Kalemli-Ozcan, 2017. "Foreign Investment and Domestic Productivity: Identifying Knowledge Spillovers and Competition Effects," 2017 Meeting Papers 1194, Society for Economic Dynamics.
    15. Castillo, Victoria & Figal-Garone, Lucas & Maffioli, Alessandro & Rojo, Sofia & Stucchi, Rodolfo, 2016. "The Effects of Knowledge Spillovers through Labor Mobility," MPRA Paper 69141, University Library of Munich, Germany.
    16. Gidehag, Anton & Lodefalk, Magnus, 2016. "Recruiting for Small Business Growth: Micro-level Evidence," Working Papers 2016:6, Örebro University, School of Business.
    17. Shawn W. Tan & Dea Tusha, 2023. "Foreign firm characteristics, labour market restrictions and FDI spillovers: Evidence from Moldova," The World Economy, Wiley Blackwell, vol. 46(1), pages 85-119, January.
    18. Peri, Giovanni & Urban, Dieter, 2006. "Catching-up to foreign technology? Evidence on the "Veblen-Gerschenkron" effect of foreign investments," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 72-98, January.
    19. Ergun Dogan & Koi Nyen Wong & Michael M. C. Yap, 2017. "Vertical and Horizontal Spillovers from Foreign Direct Investment: Evidence from Malaysian Manufacturing," Asian Economic Papers, MIT Press, vol. 16(3), pages 158-183, Fall.
    20. Sarker, Bibhuti & Serieux, John, 2022. "Foreign-invested and domestic firm attributes and spillover effects: Evidence from Brazil," Journal of Multinational Financial Management, Elsevier, vol. 63(C).

    More about this item

    Keywords

    Spillovers; Labour mobility; Product market competition; Linked employer–employee data;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:weltar:v:154:y:2018:i:2:d:10.1007_s10290-017-0304-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.