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Characteristics of Foreign-Owned Firms in British Manufacturing

In: Seeking a Premier Economy: The Economic Effects of British Economic Reforms, 1980–2000

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  • Rachel Griffith
  • Helen Simpson

Abstract

This paper describes the characteristics of manufacturing establishments in Britain over the period 1980 to 1996. Particular attention is paid to differences between plants of different ownership nationality. The findings suggest that establishments that are always foreign-owned have significantly higher labour productivity than those that remain under domestic ownership. In addition, labour productivity improves faster over time and faster with age in foreign-owned establishments. The difference in labour productivity is matched by an equivalent difference in levels of investment per employee. Establishments that change ownership nationality do not seem to experience very large changes in labour productivity levels. The proportion of skilled workers in the workplace, and wages for both skilled and operative workers are higher in foreign-owned establishments than domestic-owned, in line with differences in labour productivity.
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Suggested Citation

  • Rachel Griffith & Helen Simpson, 2004. "Characteristics of Foreign-Owned Firms in British Manufacturing," NBER Chapters, in: Seeking a Premier Economy: The Economic Effects of British Economic Reforms, 1980–2000, pages 147-180, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:6747
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    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • F2 - International Economics - - International Factor Movements and International Business

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