The labor market effects of foreign owned firms

By Rita Almeida. 2004

188 citations recorded by the source corpus.

Foreign firms often have a more educated workforce and pay higher wages than domestic firms. This does not necessarily imply that foreign ownership translates into higher demand for educated workers or higher wages, since foreign investment may be guided by unobservable firm characteristics correlated with the demand for educated workers or wages. The author examines foreign acquisitions of domestic firms in Portugal in the 1990s and finds small changes in the workforce skill composition and wages following acquisition. Foreign investors"cherry pick"domestic firms that are already very similar to the group of existing foreign firms.

Subfields: Accounting, Economics and Econometrics, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/da12dce0389bd9d0f0381e14d64d13123f503558

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Citations in the corpus

Gifted Kids or Pushy Parents? Foreign Direct Investment and Plant Productivity in Indonesia (2009, background): “Based on matched employer-employee data from Portugal, Almeida (2007) shows that foreign acquisitions of domestic firms have small effects on the human capital and on average wages of the acquired firms.”
Does FDI Bring Good Jobs to Host Countries? (2012, background): “The higher wages paid by foreign affiliates may also be a result of cherry picking, in which foreign companies acquire domestic firms with above-average human capital (Almeida 2007).”