‘Footloose’ Multinationals?

Abstract

This paper examines whether multinational companies are more footloose than their domestic counterparts in the host country, using data for the Irish manufacturing sector. First, we investigate whether plant survival rates differ between multinationals and indigenous plants. Second, we analyse whether employment is more unstable in multinationals. As regards to the first aspect we find that multinationals are more likely to exit the market than indigenous plants when controlling for other plant and industry specific characteristics. In terms of employment persistence we find that new jobs generated in MNCs appear to be more persistent than jobs generated in indigenous plants. In contrast, they are not any more or less likely to reverse employment reductions, all other things being equal.

Foreign ownership and firm survival: First evidence for enterprises in Germany

“…Results are highly countrydependent. Foreign affiliates were found to be more likely to exit as compared to their domestic counterparts in Ireland (Görg and Strobl (2003a), (2003b) and O'Farrell and Crouchley (1983), Belgium (Van Beveren (2007)), Spain (Pérez, Sanchis Llopis, and Sanchis Llopis (2004)), and Indonesia (Bernard and Sjöholm (2003)) but less likely to 4 exit in Canada (Baldwin and Yan (2011)), Italy (Colombo and Delmastro (2000)),…”

Non-union worker representation, foreign owners, and the performance of establishments

“…Goerg and Strobl (2003) show that multinational enterprises are more likely to close local plants. Bernard and Sjoeholm (2003) obtain a similar result for Indonesia.…”

Creating jobs through public subsidies: An empirical analysis

“…In particular, labour demand in foreign firms is more sensitive to changes in the price of labour and output. One reason for this may be that because foreign firms are by definition part of a multinational operation, it is easier for them to adjust their production process to changes in price and product demand (Görg and Strobl, 2003a). In contrast, there is only a marginal difference in the coefficients on grant payments across nationality of ownership.…”