Do Foreign-Owned Firms Provide Better Working Conditions Than Their Domestic Counterparts? A Comparative Analysis

Martins, Pedro S.

doi:10.2139/ssrn.1705304

Cited by 8 publications

(7 citation statements)

References 44 publications

(21 reference statements)

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“…ownership, 48 percent of jointly owned and 41 percent of local firms report that an inadequately educated workforce affects their performance, compared with 30 percent of foreign-owned firms. This finding is consistent with literature that suggests that on average, foreign firms are in a relatively better financial position to attract quality workers (Hijzen, Martins, and Schank 2010). Almost half of all firms operating in six different industrial and service sectors reported that an inadequately educated workforce affects their performance.…”

Section: Contextsupporting

confidence: 91%

Are Oil and Gas Smothering the Private Sector in Trinidad and Tobago?

Khadan¹

2017

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ative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives (CC-IGO BY-NC-ND 3.0 IGO) license (http://creativecommons.org/licenses/by-nc-nd/3.0/igo/legalcode) and may be reproduced with attribution to the IDB and for any non-commercial purpose.No derivative work is allowed.Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license.Note that link provided above includes additional terms and conditions of the license. A recent example of this is echoed in the national budget statement for 2017: Diversification… requires that the private sector changes its mindset, from commerce to industry, from focus on the domestic market to seeking to explore global markets, from consuming foreign exchange to earning foreign exchange, from avoiding risks in new ventures and technologies to taking on new risks and facing new competitive pressures to conquer new fields.Such expectations should be grounded in reality and context. Unfortunately, there are no empirical studies on the country's private sector that can provide relevant guidance. Therefore, this report is the first contribution to empirically answering questions related to the performance and challenges facing the private sector in Trinidad and Tobago.Given the sense of urgency expounded for the private sector's enhanced role in supporting economic growth, creating employment, and improving the economic welfare of the nation's citizenry, we find that there is much work to be done. Firm-level performance indicators suggest that the majority of firms are either stagnant or declining. In addition, total factor productivity measured at the firm level is relatively lower in Trinidad and Tobago when compared with other countries in the Caribbean, labour productivity has been declining since the great recession, and private investment is significantly lower than the average for other small commodity-exporting countries. vi ARE OIL AND GAS SMOTHERING THE PRIVATE SECTOR IN TRINIDAD AND TOBAGO?Hence, a concerted policy effort is required to transform Trinidad and Tobago's private sector into an engine of sustainable growth.This study examines factors relating to the profile of firms, macroeconomic conditions, the business climate, and laments of businesspersons as possible constraints to performance. The findings reveal that an unfavorable macroeconomic environment and business climate affects all firms in the private sector. With respect to the former, the main issue relates to an overvalued exchange rate-a negative externality of being hydrocarbon-dependent. An unfavorable business climate reflects government policies, regulations, and public services that hinder rather than promote a dynamic, export-oriented and innovative private sector. Moreover, th...

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Section: Contextsupporting

confidence: 91%

Are Oil and Gas Smothering the Private Sector in Trinidad and Tobago?

Khadan¹

2017

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“…Period end: Canada: 2004Korea and Portugal: 2005;Japan, Poland and Slovenia: 2006;other countries: 2007. Source: own calculations from OECD STAN family databases and EUKLEMS (OECD 2008;Hijzen et al 2010). There is also evidence of wage spillovers to other domestic firms (Driffield and Girma 2003).…”

Section: Methodsmentioning

confidence: 99%

Capital’s grabbing hand? A cross-industry analysis of the decline of the labor share in OECD countries

Bassanini

Manfredi

2014

Eurasian Bus Rev

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We examine the determinants of the within-industry decline of the labor share, using industry-level annual data for 25 OECD countries, 20 business-sector industries and covering up to 28 years. We find that total factor productivity growth-which captures (albeit imprecisely) capital-augmenting or labor-replacing technical change-and capital deepening jointly account for as much as 80 % of the within-industry contraction of the labor share. We also find that another factor explaining the aggregate decline of the labor share is the increased international competition, with higher import penetration causing a contraction of the share of labour-intensive industries in total value added. However, the fraction of the drop of the labor share explained by international competition remains limited.

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“…Hence, it would be difficult to account for potential endogeneity of ownership status by comparing establishments with and without a change in ownership status. Such approach is used by Andrews et al (2009) and Hijzen et al (2010) to examine the wage effects of foreign ownership. The problem of a small number of changes in ownership status might be less severe in their studies as they consider individual workers' wages.…”

Section: The Issue Of Endogeneitymentioning

confidence: 99%

Non-union worker representation, foreign owners, and the performance of establishments

Jirjahn

Mueller

2012

Oxford Economic Papers

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Using German establishment data, this study provides the first econometric analysis on the interaction of establishment-level codetermination and foreign owners. Works councils are associated with higher productivity in domestic-owned establishments while they are associated with lower productivity in foreign-owned establishments. Our results conform to the notion that foreign ownership can involve strong tensions with the institutional patterns of the host country.JEL classifications: J53, J54, M54.

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Do Foreign-Owned Firms Provide Better Working Conditions Than Their Domestic Counterparts? A Comparative Analysis

Cited by 8 publications

References 44 publications

Are Oil and Gas Smothering the Private Sector in Trinidad and Tobago?

Are Oil and Gas Smothering the Private Sector in Trinidad and Tobago?

Capital’s grabbing hand? A cross-industry analysis of the decline of the labor share in OECD countries

Non-union worker representation, foreign owners, and the performance of establishments

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