Scandinavian Working Papers in Economics
SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics
No 200: Foreign Direct Investment and Employment: Home Country Experience in the United States and Sweden
Magnus Blomström (), Gunnar Fors and Robert E. Lipsey
Additional contact information
Magnus Blomström: The European Institute of Japanese Studies, Postal: Stockholm School of Economics, P.O. Box 6501, S-113 83 Stockholm, Sweden
Gunnar Fors: The European Institute of Japanese Studies, Postal: Stockholm School of Economics, P.O. Box 6501, S-113 83 Stockholm, Sweden
Robert E. Lipsey: Queens College and the Graduate Center - CUNY and National Bureau of Economic Research, Postal: 50 East 42nd Street, 17th Floor, New York, NY 10017-5405, USA
Abstract: We compare the relation between foreign affiliate production and parent employment in U.S. manufacturing multinationals with that in Swedish firms. U.S. multinationals appear to have allocated some of their more labor intensive operations selling in world markets to affiliates in developing countries, reducing the labor intensity in their home production. Swedish multinationals produce relatively little in developing countries and most of that has been for sale within host countries with import-substituting trade regimes. The great majority of Swedish affiliate production is in high-income countries, the U.S. and Europe, and is associated with more employment, particularly blue-collar employment, in the parent companies. The small Swedish-owned production that does take place in developing countries is also associated with more white-collar employment at home. The effects on white-collar employment within the Swedish firms have grown smaller and weaker over time.
Keywords: FDI; Home employment
19 pages, October 27, 1997
- Published as
- Magnus Blomström, Gunnar Fors and Robert E. Lipsey, (1997), 'Foreign Direct Investment and Employment: Home Country Experience in the United States and Sweden', Economic Journal, vol 107, no 445, pages 1787-1797
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