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Multinational companies, backward linkages and labour demand elasticities
Walsh, Frank; Görg, Holger; Henry, Michael; Strobl, Eric
This paper investigates the link between nationality of ownership and wage elasticities of labour demand at the level of the plant. In particular, we examine whether labour demand in multinationals becomes less elastic with respect to the wage if the plant has backward linkages with the local economy. Our empirical evidence, based on a rich plant level dataset, shows that the extent of local linkages indeed reduces the wage elasticity of labour demand. This result is economically important and holds for a number of different specifications. Leverhulme Trust (Programme Grant No. F114/BF; Economic and Social Research Council (Grant No. RES-000-22-0468).
Keyword(s): Labour demand; Elasticities; Linkages; Multinational companies; F23; J23; L23; Labor demand; Elasticity (Economics); International business enterprises
Publication Date:
Type: Working paper
Peer-Reviewed: Unknown
Language(s): English
Institution: University College Dublin
Publisher(s): University College Dublin; School of Economics
File Format(s): other; application/pdf
First Indexed: 2012-08-25 05:25:08 Last Updated: 2018-10-11 16:37:45