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Margins of Multinational Labor Substitution / Marc-Andreas Muendler, Sascha O. Becker.
- Format:
- Book
- Author/Creator:
- Muendler, Marc-Andreas.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w14776.
- NBER working paper series no. w14776
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2009.
- Summary:
- Employment at multinational enterprises (MNEs) responds to wages at the extensive margin, when an MNE enters a foreign location, and at the intensive margin, when an MNE operates existing affiliates. We present an MNE model and conditions for parametric and nonparametric identification. Prior studies rarely found wages to affect MNE employment. We document a complementarity bias when the extensive margin is excluded and detect salient labor substitution at both margins for German manufacturing MNEs. With a one-percent increase in home wages, for instance, MNEs add 2,000 jobs in Eastern Europe at the extensive margin and 4,000 jobs overall; a converse one-percent drop in Eastern European wages removes 730 German MNE jobs.
- Notes:
- Print version record
- March 2009.
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