Abstract
Using parent–foreign affiliate matched data on Japan from 1995 to 2009, this paper examines the effects of foreign direct investment (FDI) on domestic employment, especially in manufacturing. One of the contributions of this paper is that we utilize the matched data for each country in which Japanese multinational firms operate, which enables us to identify the differences in the impact of FDI between destinations. Results indicate that the increases in the investment goods price in China but the decreases in it in the United States negatively affected the domestic labor demand of multinationals in Japan. This contrast may reflect a difference in specialization patterns across countries. We also found that disemployment in Japan was driven mainly by substitution between capital and labor, rather than by the reallocation of labor from Japan to overseas.
| Original language | English |
|---|---|
| Pages (from-to) | 433-460 |
| Number of pages | 28 |
| Journal | Review of World Economics |
| Volume | 151 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2014 Nov 12 |
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Keywords
- Foreign direct investment
- Unconditional labor demand
- Unemployment
ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)
Cite this
Disemployment caused by foreign direct investment? Multinationals and Japanese employment. / Kambayashi, Ryo; Kiyota, Kozo.
In: Review of World Economics, Vol. 151, No. 3, 12.11.2014, p. 433-460.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Disemployment caused by foreign direct investment? Multinationals and Japanese employment
AU - Kambayashi, Ryo
AU - Kiyota, Kozo
PY - 2014/11/12
Y1 - 2014/11/12
N2 - Using parent–foreign affiliate matched data on Japan from 1995 to 2009, this paper examines the effects of foreign direct investment (FDI) on domestic employment, especially in manufacturing. One of the contributions of this paper is that we utilize the matched data for each country in which Japanese multinational firms operate, which enables us to identify the differences in the impact of FDI between destinations. Results indicate that the increases in the investment goods price in China but the decreases in it in the United States negatively affected the domestic labor demand of multinationals in Japan. This contrast may reflect a difference in specialization patterns across countries. We also found that disemployment in Japan was driven mainly by substitution between capital and labor, rather than by the reallocation of labor from Japan to overseas.
AB - Using parent–foreign affiliate matched data on Japan from 1995 to 2009, this paper examines the effects of foreign direct investment (FDI) on domestic employment, especially in manufacturing. One of the contributions of this paper is that we utilize the matched data for each country in which Japanese multinational firms operate, which enables us to identify the differences in the impact of FDI between destinations. Results indicate that the increases in the investment goods price in China but the decreases in it in the United States negatively affected the domestic labor demand of multinationals in Japan. This contrast may reflect a difference in specialization patterns across countries. We also found that disemployment in Japan was driven mainly by substitution between capital and labor, rather than by the reallocation of labor from Japan to overseas.
KW - Foreign direct investment
KW - Unconditional labor demand
KW - Unemployment
UR - http://www.scopus.com/inward/record.url?scp=84938197447&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=84938197447&partnerID=8YFLogxK
U2 - 10.1007/s10290-014-0205-6
DO - 10.1007/s10290-014-0205-6
M3 - Article
AN - SCOPUS:84938197447
VL - 151
SP - 433
EP - 460
JO - Review of World Economics
JF - Review of World Economics
SN - 1610-2878
IS - 3
ER -