Do Former Employees of Foreign MNEs Boost Incumbent Workers’ Wages in Domestic Firms?

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Title: Do Former Employees of Foreign MNEs Boost Incumbent Workers’ Wages in Domestic Firms?
Authors: Flaherty, Eóin T.
Permanent link: http://hdl.handle.net/10197/12781
Date: 15-Feb-2022
Online since: 2022-02-28T17:02:30Z
Abstract: This paper examines evidence on wage spillovers from workers with experience in foreign multinational enterprises (MNEs) to incumbent workers in domestic firms. Using administrative panel data from Ireland, I examine possible heterogeneity for such spillovers across the wage distribution using quantile regressions. I begin by using existing methodology and find that, once industry-year and region-year dummies are added as control variables, the average wage spillover effect on incumbents from former foreign MNE workers moving to domestic firms disappears. The quantile results suggest that there are positive spillovers for incumbent workers in the top 40 percent of the wage distribution only. This indicates that foreign MNEs increase inequality through spillovers to domestic firms via labour mobility.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Start page: 1
End page: 49
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP2022/08
Copyright (published version): 2022 the Author
Keywords: Foreign direct investmentSpilloversLabor mobilityLinked employer-employee dataWages
JEL Codes: F16; F23; J31; J60
Language: en
Status of Item: Not peer reviewed
This item is made available under a Creative Commons License: https://creativecommons.org/licenses/by-nc-nd/3.0/ie/
Appears in Collections:Economics Working Papers & Policy Papers

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