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Inward FDI and demand for skills in Sweden

Author

Listed:
  • Bandick, Roger

    (Department of Business, Economics, Statistics and Informatics)

  • Hansson, Pär

    (FIEF)

Abstract

We observe a substantial increase of foreign ownership in Sweden in the 1990s. Did that have any effect on relative demand for skilled labor? Has technology transfers often associated with inward FDI led to increased demand for skills due to skilled-biased technical change? Are there any grounds for the worries in the public Swedish debate that more skilled activities have been moved abroad to countries where the headquarters are located? We obtain support for that the share of skilled labor tends to rise in non-multinationals but not in multinationals that become foreign owned. Yet it does not seem to be any relationship between increased foreign ownership and the relative demand for skilled labor in Swedish manufacturing between 1986 and 2000. Interestingly, increased competition from low-wage countries, rather than inward FDI, has had significant impact on skill upgrading, and appears to have played a larger role in the 1990s than before.

Suggested Citation

  • Bandick, Roger & Hansson, Pär, 2005. "Inward FDI and demand for skills in Sweden," Working Papers 2005:10, Örebro University, School of Business.
  • Handle: RePEc:hhs:oruesi:2005_010
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    References listed on IDEAS

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    1. Bandick, Roger & Karpaty, Patrick, 2007. "Foregin Acquisition and Employment Effects in Swedish Manufacturing," Working Papers 2007:10, Örebro University, School of Business.

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    More about this item

    Keywords

    foreign ownership; skill upgrading; wage differentials;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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