Intra-firm trade and employment in US manufacturing

Sotiris Blanas

No 458, Kiel Advanced Studies Working Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: This paper studies the impact of trade within US-headquartered multinational companies (MNCs) on labour demand for all employees, as well as, for those of high and low skill in US manufacturing for the period 1995 - 2005. We find strong evidence on the positive and negative effect of intra-firm exports and imports respectively, on aggregate employment. The former effect is stronger than the latter. Moreover, we find that demand for low-skilled labour is negatively associated with intra-firm imports, while unaffected by intra-firm exports. In contrast, high-skilled labour demand is positively linked to intra-firm exports but unaffected by intra-firm imports. The last two findings put together, suggest that low-skill intensive stages of the value-added chain are mostly transferred to the US affiliates abroad, while highskill intensive ones are mostly kept within the US parents.

Keywords: Multinational Companies (MNCs); intra-firm imports; intra-firm exports; employment; low-skilled workers; high-skilled workers (search for similar items in EconPapers)
JEL-codes: F16 F23 J21 J23 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwasw:458

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