Wages and Foreign Ownership: A Comparative Study of Mexico, Venezuela and the United States

34 Pages Posted: 11 Jun 2000

See all articles by Brian Aitken

Brian Aitken

International Monetary Fund (IMF)

Ann E. Harrison

University of Pennsylvania - Management Department; National Bureau of Economic Research (NBER)

Robert E. Lipsey

National Bureau of Economic Research (NBER) at New York (Deceased)

Date Written: May 1995

Abstract

This paper explores the relationship between wages and foreign investment in Mexico, Venezuela, and the United States. Despite very different economic conditions and levels of development, we find one fact which is robust across all three countries: higher levels of foreign investment are associated with higher wages. In Mexico and Venezuela, foreign investment was associated with higher wages only for foreign-owned firms -- there is no evidence of wage spillovers leading to higher wages for domestic firms. In the United States there is evidence of wage spillovers. The lack of spillovers in Mexico and Venezuela is consistent with significant wage differentials between foreign and domestic enterprises. In the United States, wage differentials are smaller.

Suggested Citation

Aitken, Brian and Harrison, Ann E. and Lipsey, Robert E., Wages and Foreign Ownership: A Comparative Study of Mexico, Venezuela and the United States (May 1995). NBER Working Paper No. w5102. Available at SSRN: https://ssrn.com/abstract=225167

Brian Aitken

International Monetary Fund (IMF)

700 19th Street NW
Washington, DC 20431
United States

Ann E. Harrison (Contact Author)

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Robert E. Lipsey

National Bureau of Economic Research (NBER) at New York (Deceased)

Register to save articles to
your library

Register

Paper statistics

Downloads
47
Abstract Views
3,629
PlumX Metrics