SSE/EFI Working Paper Series in Economics and Finance
No 408:
Outward Investment, Employment and Wages in Swedish Multinationals
Magnus Blomström ()
and Ari Kokko ()
Abstract: Examining detailed data for the home country operations of
Swedish multinationals during the period 1986-1994, this paper shows that
there are signs of very notable structural changes in the home country
operations of these corporations. It also shows that the effects vary
according to economic conditions in the home country. In the 1980s, when
the Swedish economy was characterized by high taxes, high inflation rates,
and a tight labor market, relatively attractive jobs within the MNCs were
relocated from Swedish plants to foreign affiliates. In the 1990s, by
contrast, when the financial crisis had necessitated a host of micro and
macro economic reforms, the location decision of the MNCs were more
favorable for the Swedish economy. New jobs created by the multinationals
were found in activities with high productivity and wages. Thus, home
country effects of FDI seem, to a large extent, to be determined by the
home countries' economic environment.
Keywords: FDI; MNC; Home Country Effects; (follow links to similar papers)
JEL-Codes: F23; (follow links to similar papers)
25 pages, October 20, 2000
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- This paper is published as:
-
Blomström, Magnus and Ari Kokko, (2000), 'Outward Investment, Employment and Wages in Swedish Multinationals', Oxford Review of Economic Policy, Vol. 16 (3), pages 76-89
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