Does it matter where you invest? The impact of foreign direct investments on domestic job creation and destruction

نویسندگان

چکیده

Abstract This study examines how foreign direct investment (FDI) affects domestic employment by using unique division‐level data of Japanese firms. Contrary to most previous studies focusing on the effect FDI net growth, we decompose it into job creation (JC) and destruction (JD) for each individual firm. We find that destination plays an important role: Asia increases JC, whereas Europe/North America decreases it; furthermore JD decreases, regardless destination. A frictional search‐and‐matching model with heterogeneous jobs can explain differential effects. The provides additional predictions JC type, which are also empirically confirmed.

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ژورنال

عنوان ژورنال: The World Economy

سال: 2022

ISSN: ['1467-9701', '0378-5920']

DOI: https://doi.org/10.1111/twec.13297