Blessing or Curse? Domestic Plants' Survival and Employment Prospects After Foreign Acquisition

Sourafel Girma and Görg, Holger
Authors registered in the RePEc Author Service: Holger Görg

No 2994, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This Paper investigates whether the acquisition of a domestic establishment by a foreign owner has any effects, positive or negative, on the survival prospects and employment growth of that plant. The empirical analysis uses data from the Annual Respondents Database (ARD) for the UK electronics industry for the period 1980 to 1993. Estimating a standard hazard model including a dummy variable for the incidence of acquisition yields the result that foreign take-over reduces the lifetime of the acquired plant. Estimations of the determinants of employment growth in domestic plants provide some evidence that the incidence of take-over reduces employment growth, in particular for unskilled labour. Both survival and employment growth estimations do not appear to be subject to endogeneity problems.

Keywords: Foreign direct investment; Acquisitions; Survival; Employment growth (search for similar items in EconPapers)
JEL-codes: C41 F23 (search for similar items in EconPapers)
Date: 2001-10
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Citations: View citations in EconPapers (11)

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Working Paper: Blessing or Curse? Domestic Plants' Survival and Employment Prospects after Foreign Acquisitions (2003)
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