Research Output
1 - 6 of 6
Publication
Multinational companies, backward linkages and labour demand elasticities
2006-12, Walsh, Frank, Görg, Holger, Henry, Michael, Strobl, Eric
This paper investigates the link between nationality of ownership and wage elasticities of labour demand at the level of the plant. In particular, we examine whether labour demand in multinationals becomes less elastic with respect to the wage if the plant has backward linkages with the local economy. Our empirical evidence, based on a rich plant level
dataset, shows that the extent of local linkages indeed reduces the wage elasticity of labour demand. This result is economically important and holds for a number of different specifications.
Publication
Internationalisation of Services, Productivity and Economic Growth: Literature Review
2010-11, Görg, Holger, Haller, Stefanie, Siedschlag, Iulia
Over the past decade there has been an increased internationalisation of services via trade and investment as well as an increased international outsourcing of services. However, to date there is a lack of solid empirical evidence on the extent and determinants of the internationalisation of services in the European Union and its effects on productivity, employment growth and competitiveness. This study discusses recent theory and empirical evidence on the internationalisation of services and its effects on firm performance. In addition, it outlines existing knowledge gaps and proposes a research agenda and methodology to address them.
Publication
Why Do Foreign Firms Pay More: The Role of On-the-Job-Training
2007-10, Görg, Holger, Strobl, Eric, Walsh, Frank
While foreign-owned firms have consistently been found to pay higher wages than domestic firms to what appear to be equally productive workers, the causes of this remain unresolved. In a two-period bargaining framework we show that if training is more productive and specific in foreign firms, foreign firm workers will have a steeper wage profile and thus acquire a premium over time. Using a rich employer-employee matched data set we verify that the foreign wage premium is only acquired by workers over time spent in the firm and only by those that receive on the job training, thus providing empirical support for a firm specific human capital acquisition explanation.
Publication
Foreign direct investment, agglomerations and demonstration effects : an empirical investigation
2001-03, Barry, Frank, Görg, Holger, Strobl, Eric
Many previous studies have shown that the localisation of firms can be an important
factor in attracting new foreign direct investment into a host country. What has been missing in this literature thus far, however, is an investigation into the reasons why industry clusters attract firms. We distinguish between “efficiency agglomerations” as firms locating close to each other because they can increase their efficiency by doing so, and “demonstration effects”, whereby existing firms send signals to new investors as to the reliability of the host country and newly entering firms follow previous firms. In this paper we try to disentangle these two effects, by examining the location of US and UK firms in Ireland. We calculate proxies for “efficiency agglomerations” and
“demonstration effects” and include these proxies in an empirical model of the location decision of firms. For US firms, we find that both efficiency agglomeration and demonstration effects are important determinants of entry. For UK firms, however, the evidence is not as clear cut.
Publication
Creating jobs through public subsidies : an empirical analysis
2008, Girmaa, Sourafel, Görg, Holger, Strobl, Eric, Walsh, Frank
This paper analyses the impact of government grants on labour demand using plant level data for manufacturing industry in Ireland. Our data consists of a large sample of plants and their complete grant history. We provide evidence that additional employment is created over and above the level that would have prevailed in the absence of grant payments. We also find differences in the employment response to subsidies between domestic and foreign-owned plants, with the former creating more additional jobs per euro of grant payment. Simple cost-benefit analysis reveals that a large part of the costs of grants appears to be recouped in additional wage streams under reasonable assumptions.
Publication
Outward FDI and the investment development path of a late-industrialising economy : evidence from Ireland
2001-04, Barry, Frank, Görg, Holger, McDowell, Andrew
The Investment Development Path (IDP) hypothesis holds that a country’s net outward
direct investment position is systematically related to its level of economic development.
Ireland is an interesting test case because of the importance of inward FDI over the last
three decades, the country's rapid recent FDI-fuelled growth, and the recent increase in outward FDI by Irish-owned multinationals. We find empirical support for the IDP concept for the Irish case. Our sectoral analysis shows up important differences between Ireland's outward FDI and the bulk of FDI occurring in the world economy however. Ireland's outward FDI flows are as yet almost exclusively horizontal and they go largely into non-internationally-tradable manufacturing and services sectors. Also, the firm specific assets of Irish multinationals lie neither in R&D nor in the type of product differentiation associated with high advertising expenditures.