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Cross-Border Acquisitions, Multinationals and Wage Elasticities

  • Hakkala, Katariina

    (Research Institute of Industrial Economics (IFN))

  • Heyman, Fredrik

    ()

    (Research Institute of Industrial Economics (IFN))

  • Sjöholm, Fredrik

    ()

    (Research Institute of Industrial Economics (IFN))

The growing number of cross-border acquisitions has in many countries raised concerns about labor demand consequences. In this study, we use detailed firm level data to examine how increased internationalization and multinational activity affect the volatility of employment, or rather, the wage elasticity of labor demand. We analyze whether the wage elasticity of labor demand differs between multinational and non-multinational firms as well as between foreign-owned and domestic firms, and we are able to distinguish between different skill groups of employees. Moreover, we separate between an acquisition effect and a general ownership effect. Our results do not show any general difference in wage elasticities between different types of firms.

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Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 709.

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Length: 36 pages
Date of creation: 29 Jun 2007
Date of revision:
Publication status: Published as Hakkala, Katariina, Fredrik Heyman and Fredrik Sjöholm, 'Cross-Border Acquisitions, Multinationals and Wage Elasticities' in Review of World Economics, 2010, pages 263-280.
Handle: RePEc:hhs:iuiwop:0709
Contact details of provider: Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Phone: +46 8 665 4500
Fax: +46 8 665 4599
Web page: http://www.ifn.se/
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