Abstract

http://ssrn.com/abstract=1133815
 
 

References (22)



 
 

Citations (18)



 


 



Why Do Foreign-Owned Firms Pay More? The Role of On-the-Job Training


Holger Gorg


Kiel Institute for the World Economy; Institute for the Study of Labor (IZA)

Eric Strobl


Ecole Polytechnique, Paris - Department of Economic Sciences; Institute for the Study of Labor (IZA)

Frank Walsh


National University of Ireland - University College Dublin

March 2007

CEPR Discussion Paper No. DP6171

Abstract:     
While foreign-owned firms have consistently been found to pay higher wages than domestic firms to what appear to be equally productive workers, the causes of this remain unresolved. In a two-period bargaining framework we show that if training is more productive and specific in foreign firms, foreign firm workers will have a steeper wage profile and thus acquire a premium over time. Using a rich employer-employee matched data set we verify that the foreign wage premium is only acquired by workers over time spent in the firm and only by those that receive on the job training, thus providing empirical support for a firm specific human capital acquisition explanation.

Number of Pages in PDF File: 28

Keywords: Foreign firms, on-the-job training, wages

JEL Classification: F23, J24

working papers series





Date posted: May 20, 2008  

Suggested Citation

Gorg, Holger and Strobl, Eric and Walsh, Frank, Why Do Foreign-Owned Firms Pay More? The Role of On-the-Job Training (March 2007). CEPR Discussion Paper No. DP6171. Available at SSRN: http://ssrn.com/abstract=1133815

Contact Information

Holger Görg (Contact Author)
Kiel Institute for the World Economy ( email )
P.O. Box 4309
Kiel, D-24100
Germany
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Eric Strobl
Ecole Polytechnique, Paris - Department of Economic Sciences ( email )
Ecole Polytechnique
Department of Economics
Paris, 75005
France
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Frank Walsh
National University of Ireland - University College Dublin ( email )
Department of Economics
Belfield
Dublin 4
Ireland
353-1-7068697 (Phone)
353-1-2830068 (Fax)
HOME PAGE: http://www.ucd.ie/~economic/staff/fwalsh/
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References:  22
Citations:  18

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