The Productivity and Wage Effects of Foreign Acquisition in the United Kingdom

18 Pages Posted: 13 Dec 2002

See all articles by Martin J. Conyon

Martin J. Conyon

Lancaster University - Management School; Wharton School, Center for Human Resources

Sourafel Girma

Nottingham University Business School

Steve Thompson

University of Leicester - Department of Economics

Peter W Wright

University of Sheffield - Department of Economics

Abstract

This paper provides a systematic empirical analysis of the impact of foreign ownership on productivity and wages in the United Kingdom. Using a specially constructed database for the period 1989-1994, it uses ownership change (acquisition) to control for unobserved differences between plants. It finds that foreign firms pay equivalent employees 3.4% more than domestic firms, though this is wholly attributable to their higher levels of productivity. Firms which are acquired by foreign companies exhibit an increase in labour productivity of 13%.

Suggested Citation

Conyon, Martin J. and Girma, Sourafel and Thompson, Steve and Wright, Peter W, The Productivity and Wage Effects of Foreign Acquisition in the United Kingdom. Journal of Industrial Economics, Vol. 50, No. 1, pp. 85-102, March 2002. Available at SSRN: https://ssrn.com/abstract=309197

Martin J. Conyon (Contact Author)

Lancaster University - Management School ( email )

Bailrigg
Lancaster, LA1 4YX
United Kingdom

Wharton School, Center for Human Resources ( email )

3600 Locust Walk
Philadelphia, PA 19104-6365
United States

Sourafel Girma

Nottingham University Business School ( email )

Jubilee Campus
Nottingham, NG8 1BB
United Kingdom
+44 0 115 8466656 (Phone)

HOME PAGE: http://www.nottingham.ac.uk/~lizsmg/

Steve Thompson

University of Leicester - Department of Economics ( email )

Department of Economics
Leicester LE1 7RH, Leicestershire LE1 7RH
United Kingdom
+44 116 252 2897 (Phone)

Peter W Wright

University of Sheffield - Department of Economics ( email )

9 Mappin Street
Sheffield, S1 4DT
UNITED KINGDOM

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