Swedish Multinationals and Competition from High- and Low-Wage Locations

Henrik Braconier and Karolina Ekholm (karolina.ekholm@ne.su.se)
Additional contact information
Henrik Braconier: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden, https://www.ifn.se

No 523, Working Paper Series from Research Institute of Industrial Economics

Abstract: This study uses data on Swedish multinationals to estimate cross elasticities of labour demand in different locations. With a vertical decomposition of the firm's activities, whether there is substitution or complementarity between employment in different parts of the firm will depend on whether wage changes lead to a relocation of activities or simply to changes in marginal costs and/or demand for inputs in other parts of the firms. We find that there is some evidence of a substitutionary relationship between employment in the Swedish parts of the firms and employment in other high-income locations, but we do not find any evidence of substitution stemming from employment in low-income locations. We find mainly a relationshipof complementarity between employment in different affiliates.

Keywords: Labour demand; Multinational firms; Vertically integrated firms (search for similar items in EconPapers)
JEL-codes: F23 J23 (search for similar items in EconPapers)
Pages: 29 pages
Date: 1999-11-01
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published in Review of International Economics, 2000, pages 448-461.

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Related works:
Journal Article: Swedish Multinationals and Competition from High‐ and Low‐Wage Locations (2000)
Working Paper: Swedish Multinationals and Competition from High- and Low-Wage Locations (1999)
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