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The Contribution of Multinational Corporations to U.S. Productivity Growth, 1977-2000

In: International Trade in Services and Intangibles in the Era of Globalization

Listed author(s):
  • Carol Corrado
  • Paul Lengermann
  • Larry Slifman

In this paper, we decompose aggregate labor productivity growth in order to gauge the relative importance of multinational corporations (MNCs) to the economic performance of the United States in the 1990s. As we define it, the MNC sector refers to the U.S. activities of multinational corporations operating in the United States. We develop productivity estimates for MNCs using (1) published and unpublished industry-level data from two surveys conducted by the Bureau of Economic Analysis and (2) productivity data for industries and major sectors from the FRB productivity system (Bartelsman and Beaulieu 2003, 2004). The resulting MNC sector accounted for about 40 percent of the gross product of all nonfinancial corporations and all of the pickup in nonfinancial corporate labor productivity in the late 1990s. Accordingly, the MNC sector accounted for more than half of the acceleration in labor productivity growth of all U.S. nonfarm private businesses.

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This chapter was published in:
  • Marshall Reinsdorf & Matthew J. Slaughter, 2009. "International Trade in Services and Intangibles in the Era of Globalization," NBER Books, National Bureau of Economic Research, Inc, number rein09-1.
  • This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 11614.
    Handle: RePEc:nbr:nberch:11614
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    8. Chiara Criscuolo & Ralf Martin, 2004. "Multinationals and U.S. Productivity Leadership: Evidence from Great Britain," OECD Science, Technology and Industry Working Papers 2004/5, OECD Publishing.
    9. Gordon H. Hanson & Raymond J. Mataloni & Matthew J. Slaughter, 2001. "Expansion Strategies of U.S. Multinational Firms," BEA Papers 0012, Bureau of Economic Analysis.
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    12. Yeaple, Stephen & Helpman, Elhanan & Melitz, Marc, 2004. "Export versus FDI with Heterogeneous Firms," Scholarly Articles 3229098, Harvard University Department of Economics.
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    22. Peter Howitt, 2000. "Endogenous Growth and Cross-Country Income Differences," American Economic Review, American Economic Association, vol. 90(4), pages 829-846, September.
    23. Haskel, Jonathan & Pereira, Sonia & Slaughter, Matthew, 2002. "Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?," CEPR Discussion Papers 3384, C.E.P.R. Discussion Papers.
    24. Kevin J. Stiroh, 2001. "Information technology and the U.S. productivity revival: what do the industry data say?," Staff Reports 115, Federal Reserve Bank of New York.
    25. Rachel Griffith & Rupert Harrison & John Van Reenen, 2004. "How special is the special relationship?: using the impact of R&D spillovers on UK firms as a test of technology sourcing," LSE Research Online Documents on Economics 711, London School of Economics and Political Science, LSE Library.
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