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Outward FDI and local employment growth in Italy

  • Stefano Federico


    (Bank of Italy)

  • Gaetano Alfredo Minerva


    (Universita' di Bologna)

Using several data sources, we assess the impact of Italy's outward foreign direct investment (FDI) on local employment growth between 1996 and 2001 for 12 manufacturing industries and 103 administrative provinces. Our main result is that, controlling for the local industrial structure and area fixed effects, FDI is associated with faster local employment growth, relatively to the national industry average. We also find that employment in small plants is not negatively influenced by higher levels of FDI. Our findings do not support therefore the idea that FDI is detrimental to local employment growth in the home country.

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Paper provided by Bank of Italy, Economic Research and International Relations Area in its series Temi di discussione (Economic working papers) with number 613.

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Date of creation: Feb 2007
Date of revision:
Handle: RePEc:bdi:wptemi:td_613_07
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