FDI and Trade: the Irish Host-Country Experience

Abstract

In Irish manufacturing, the foreign sector accounts for about one half of employment and some  % of gross output. The Irish experience therefore provides us with a textbook case study of the effects on an EU host economy of export-oriented FDI. We explore in this paper the structural changes induced by FDI and the effects of FDI on the determinants of growth in Ireland. We also consider some possible adverse effects that may be associated with such strong reliance on multinational investment.

Creating jobs through public subsidies: An empirical analysis

“…One should also note that Forfás defines foreign plants as plants that are majority-owned by foreign shareholders, i.e., where there is at least 50 per cent foreign ownership. While, arguably, plants with lower foreign ownership should still possibly considered to be foreign owned, this is not necessarily a problem for the case of Ireland since almost all inward foreign direct investment has been greenfield investment rather than acquisition of local firms (see Barry and Bradley, 1997). One should also note that we are not able to identify takeovers (which would appear as new entrants) and changes in the main sector of production.…”

“…8 As noted earlier, previous more rudimentary estimates for Ireland seem to indicate little evidence of job additionality. Furthermore, given Ireland's peculiar industrial structure, which relies heavily on foreign multinational firms (e.g., Barry and Bradley, 1997;Görg and Strobl, 2002), we are able to analyse the different effects of grants on domestic and foreign plants separately. As we show below, this unearths some important differences across these two groups.…”

Multinational companies and wage inequality in the host country: The case of Ireland

“…1 We conduct an econometric study using data for the Irish manufacturing sector, where multinational companies have played a very significant role in terms of employment over the last two decades (Barry and Bradley, 1997;Ruane and Görg, 1997). Our results indicate that there is an inverted-U shape relationship between wage inequality and the presence of multinationals.…”

Foreign Direct Investment and Local Economic Development: Beyond Productivity Spillovers

“…While indigenous manufacturing tended to be concentrated on traditional and food-sector manufacturing activities, MNCs have invested primarily in modern high tech sectors. This has led to a rapid increase in the significance of the high tech sectors for the Irish economy (Barry and Bradley, 1997). Furthermore, many observers have argued that the influx of foreign direct investment into the Irish economy has had significant effects on the growth of the economy (e.g., Sachs, 1997, de la Fuente andVives, 1997).…”