Surviving the Global Financial Crisis: Foreign Ownership and Establishment Performance

Laura Alfaro and Maggie Chen

No 17141, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We examine the differential response of establishments to the recent global financial crisis with particular emphasis on the role of foreign ownership. Using a worldwide establishment panel dataset, we investigate how multinational subsidiaries around the world responded to the crisis relative to local establishments. We find that, first, multinational subsidiaries fared on average better than local counterfactuals with similar economic characteristics. Second, among multinational subsidiaries, establishments sharing stronger vertical production and financial linkages with parents exhibited greater resilience. Finally, in contrast to the crisis period, the effect of foreign ownership and linkages on establishment performance was insignificant in non-crisis years.

JEL-codes: F1 F2 F36 (search for similar items in EconPapers)
Date: 2011-06
New Economics Papers: this item is included in nep-ifn
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Citations: View citations in EconPapers (18)

Published as Laura Alfaro & Maggie Xiaoyang Chen, 2012. "Surviving the Global Financial Crisis: Foreign Ownership and Establishment Performance," American Economic Journal: Economic Policy, American Economic Association, vol. 4(3), pages 30-55, August.

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Journal Article: Surviving the Global Financial Crisis: Foreign Ownership and Establishment Performance (2012)
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