Investment Abroad and Adjustment at Home: evidence from UK multinational firms

Helen Simpson

The Centre for Market and Public Organisation from Department of Economics, University of Bristol, UK

Abstract: This paper provides new evidence on the effects of overseas FDI on the skill-mix of multinational firms’ home-country operations. The analysis exploits China’s WTO accession to identify the impact of outward investment into a low-wage economy, and uses plant-level data to investigate changes in industrial structure within firms driven by plant closures. As predicted by models of vertical FDI the paper demonstrates that overseas investment in low-wage economies is associated with asymmetric effects on workers in low and high skill industries in the home economy, and in particular with firms closing down plants in low-skill industries.

Keywords: multinational enterprises; skills; globalisation (search for similar items in EconPapers)
JEL-codes: F2 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab
Date: 2008-12
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Downloads: (external link)
http://www.bristol.ac.uk/cmpo/publications/papers/2008/wp207.pdf (application/pdf)

Related works:
Working Paper: Investment abroad and adjustment at home: evidence from UK multinational firms (2007)
Working Paper: Investment abroad and adjustment at home: evidence from UK multinational firms (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:bri:cmpowp:08/207

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