Multinational enterprises, industrial relatedness and employment in European regions

Nicola Cortinovis, Riccardo Crescenzi and Frank Oort

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This article investigates the link between multinational enterprises (MNEs) and employment in their host regions by cross-fertilising the literature on MNE externalities with the emerging body of research on industrial relatedness. The link between employment and MNE presence in the same and related industries is tested for European regions. The results suggest that cross-sectoral MNE spillovers are mediated through industrial relatedness and that they are positively and significantly associated with higher employment levels, independently of input–output relations. Our results indicate that regions characterised by lower factor prices are likely to benefit the most from the presence of multinationals in terms of employment, but these benefits are concentrated in high knowledge-intensive sectors, potentially fostering inequalities within less-developed economies.

Keywords: employment; foreign direct investment; relatedness; Europe; regions (search for similar items in EconPapers)
JEL-codes: F22 O33 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2020-09-01
New Economics Papers: this item is included in nep-eur, nep-geo, nep-int and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Published in Journal of Economic Geography, 1, September, 2020, 20(5), pp. 1165 - 1205. ISSN: 1468-2702

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http://eprints.lse.ac.uk/104063/ Open access version. (application/pdf)

Related works:
Journal Article: Multinational enterprises, industrial relatedness and employment in European regions (2020)
Working Paper: Multinational enterprises, industrial relatedness and employment in European regions (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:104063

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