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Ownership and workforce composition: a counterfactual analysis of foreign multinationals and Italian uni-national firms

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  • Mariachiara Barzotto

    (University of Newcastle)

  • Giancarlo Corò

    (Ca’ Foscari University)

  • Ilaria Mariotti

    (Polytechnic University of Milan)

  • Marco Mutinelli

    (University of Brescia)

Abstract

This article investigates how the ownership of firms (affiliates of foreign multinational firms, or uni-national firms) affects their internal workforce composition. We consider this issue empirically by adopting a novel database on the workforce composition of companies operating in the manufacturing industry in north-east Italy. The workforce composition (in terms of skill level, gender and the less investigated characteristics of age and nationality) of affiliates of foreign multinational enterprises (FMNs) are compared with a counterfactual of uni-national firms, constructed using propensity score matching. Consistent with previous studies, the results report that FMNs recruit a larger number of highly-skilled workers. Our main findings show that FMNs employ a lower number of foreign and less experienced (young) workers. The employment of native and more experienced workers in FMNs seems to suggest that foreign companies use domestic ‘inherited’ stock of manufacturing knowledge and skills. By using this stock, they contribute to sustaining its development.

Suggested Citation

  • Mariachiara Barzotto & Giancarlo Corò & Ilaria Mariotti & Marco Mutinelli, 2019. "Ownership and workforce composition: a counterfactual analysis of foreign multinationals and Italian uni-national firms," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 46(4), pages 581-607, December.
    • Handle: RePEc:spr:epolin:v:46:y:2019:i:4:d:10.1007_s40812-019-00114-0
    DOI: 10.1007/s40812-019-00114-0
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    Cited by:

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    2. Dante Di Matteo & Ilaria Mariotti, 2021. "Italian discontent and right‐wing populism: determinants, geographies, patterns," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(2), pages 371-396, April.

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    More about this item

    Keywords

    Foreign direct investments; Company workforce composition; Manufacturing; Veneto region;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L6 - Industrial Organization - - Industry Studies: Manufacturing

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