The organization of knowledge in multinational firms
VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy from Verein für Socialpolitik / German Economic Association
Employees must learn about firm technologies to use them in production. Within multinational firms, knowledge can be acquired centrally, by managers at headquarters, or locally, by production workers. Local knowledge acquisition increases with the bilateral communication costs with central management, and decreases with local knowledge acquisition costs. This mechanism explains why multinationals foreign sales and their probability of entry decrease in the distance of a country from the multinationals home country, and why multinationals pay higher wages than comparable domestic firms. The selection into foreign destinations and the foreign productivity distribution of German multinationals are consistent with the models predictions.
JEL-codes: D21 F21 F23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-cse, nep-int and nep-knm
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Journal Article: The Organization of Knowledge in Multinational Firms (2018)
Working Paper: The Organization of Knowledge in Multinational Firms (2018)
Working Paper: The Organization of Knowledge in Multinational Firms (2017)
Working Paper: The Organization of Knowledge in Multinational Firms (2015)
Working Paper: The organization of knowledge in multinational firms (2015)
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