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Intra-Firm Trade and Employment in US Manufacturing

  • Sotiris Blanas

This paper studies the impact of trade within US-headquartered multinational companies (MNCs) on labour demand for all employees, as well as, for those of high and low skill in US manufacturing for the period 1995 – 2005. We find strong evidence on the positive and negative effect of intra-firm exports and imports respectively, on aggregate employment. The former effect is stronger than the latter. Moreover, we find that demand for low-skilled labour is negatively associated with intra-firm imports, while unaffected by intra-firm exports. In contrast, high-skilled labour demand is positively linked to intra-firm exports but unaffected by intra-firm imports. The last two findings put together, suggest that low-skill intensive stages of the value-added chain are mostly transferred to the US affiliates abroad, while highskill intensive ones are mostly kept within the US parents

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Paper provided by Kiel Institute for the World Economy in its series Kiel Advanced Studies Working Papers with number 458.

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Length: 29 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:kie:kieasw:458
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