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Multinational corporations and labour market competition in host countries: Evidence from South Africa

Talent Nesongano

No wp-2026-33, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: This paper investigates how competition for skilled labour from foreign multinational corporations (MNCs) affects the alignment of wages and labour productivity in domestic firms. Using linked employer-employee records, worker data, and firm-level customs declarations from South Africa, combined with the World Bank's harmonized bilateral sectoral FDI data, I construct a measure of regional exposure to competition for skilled labour from MNCs. The measure exploits global sectoral FDI shocks interacted with predetermined skilled-employment shares of MNCs.

Keywords: Multinational firms; Wages; Productivity; Skilled workers; Automation (search for similar items in EconPapers)
Date: 2026
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