Employment in Host Regions and Foreign Direct Investment

Frank McDonald, Heinz J Tüselmann, Arne Heise and David Williams
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Frank McDonald: Plymouth Business School, University of Plymouth, Drake Circus, Plymouth, Devon PL4 8AA, England
Heinz J Tüselmann: International Business Unit, Manchester Metropolitan University Business School, Aytoun Building, Aytoun Street, Manchester M1 3GH, England
David Williams: Nottingham Business School, Nottingham Trent University, Burton Street, Nottingham NG1 4BU, England

Environment and Planning C, 2003, vol. 21, issue 5, 687-701

Abstract: This paper examines the relationship between foreign direct investment inflows and employment using international business strategy literature to identify the factors influencing the development of subsidiaries that might affect employment growth in host regions. A survey of German subsidiaries in North West England is used to test the significance of the variables that are identified as likely to affect employment. The results of logit regression indicate that entry mode, technology transfer, and firm age affect the growth of employment. The study also highlights that other factors, such as sector, organisational structure, the level of diversification of operations by subsidiaries in the local economy, and range of markets supplied may have important affects on employment. The research indicates that further conceptual and empirical work is required to clarify our understanding of how the organisational, operational, and diversification characteristics of subsidiaries affect employment.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:sae:envirc:v:21:y:2003:i:5:p:687-701

DOI: 10.1068/c0231

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