Foreign ownership and firm performance in German services

John P. Weche

The Service Industries Journal, 2013, vol. 33, issue 15-16, 1564-1598

Abstract: This study provides the first comprehensive analysis of foreign-controlled enterprises in the German service sector based on new micro-data from official German statistics. Various performance measures were examined via comparison of unconditional and conditional means and through use of quantile regression techniques. Foreign-controlled affiliates consistently performed better than German-owned affiliates. In contrast, profitability exhibited precisely the opposite trend. Moreover, labour productivity did not significantly differ when the comparison group consisted of domestically owned affiliates with a high degree of internationalization. A breakdown by country of origin showed that European affiliates pay lower wages and export less relative to non-European affiliates, and US firms have no productivity advantage as in manufacturing.

Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:taf:servic:v:33:y:2013:i:15-16:p:1564-1598

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DOI: 10.1080/02642069.2011.638711

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The Service Industries Journal is currently edited by Eileen Bridges, Professor Domingo Ribeiro, Ronald Goldsmith, Barry Howcroft and Youjae Yi

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