Do Multinationals Transfer Culture? Evidence on Female Employment in China

53 Pages Posted: 15 Feb 2017  

Heiwai Tang

Johns Hopkins University - Paul H. Nitze School of Advanced International Studies (SAIS); CESIfo

Yifan Zhang

Zhongshan University - Department of Economics

Date Written: January 24, 2017

Abstract

We study the global diffusion of culture through multinationals, focusing on gender norms. Using data on manufacturing firms in China over 2004-2007, we find that foreign affiliates from countries with a more gender-equal culture tend to employ proportionally more women and appoint female managers. They also generate cultural spillovers, increasing domestic firms’ female labor shares in the same industry or city. Based on a multi-sector model with firm heterogeneity in productivity, gender biases, and learning, we perform counterfactual exercises. Hypothetically eliminating firms’ gender biases raises China’s aggregate total factor productivity by 5%, of which spillovers from multinationals account for 19%.

Keywords: cultural spillover, gender inequality, FDI, misallocation

JEL Classification: F110, F210, J160, L220, O470

Suggested Citation

Tang, Heiwai and Zhang, Yifan, Do Multinationals Transfer Culture? Evidence on Female Employment in China (January 24, 2017). CESifo Working Paper Series No. 6295. Available at SSRN: https://ssrn.com/abstract=2917193

Heiwai Tang (Contact Author)

Johns Hopkins University - Paul H. Nitze School of Advanced International Studies (SAIS) ( email )

1740 Massachusetts Avenue, NW
Washington, DC 20036-1984
United States

CESIfo ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Yifan Zhang

Zhongshan University - Department of Economics ( email )

8 Castle Peak Road
Tuen Mun, NT
Hong Kong

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