Characteristics of Foreign-Owned Firms in British Manufacturing

48 Pages Posted: 21 Mar 2003 Last revised: 29 Aug 2022

See all articles by Rachel Griffith

Rachel Griffith

Institute for Fiscal Studies (IFS); University of Manchester; Centre for Economic Policy Research (CEPR)

Helen Simpson

CMPO; Institute for Fiscal Studies (IFS)

Date Written: March 2003

Abstract

This paper describes the characteristics of manufacturing establishments in Britain over the period 1980 to 1996, paying particular attention to differences between establishments of different ownership nationalities. The findings suggest that establishments that are always foreign-owned have significantly higher labour productivity than those that remain under domestic ownership. In addition, labour productivity improves faster over time and faster with age in foreign-owned establishments. The difference in labour productivity is matched by an equivalent difference in levels of investment per employee. Establishments that change ownership nationality do not seem to experience very large changes in labour productivity levels. The proportion of skilled workers in the workplace, and wages for both skilled and operative workers are higher in foreign-owned establishments than domestic-owned, in line with differences in labour productivity.

Suggested Citation

Griffith, Rachel and Simpson, Helen, Characteristics of Foreign-Owned Firms in British Manufacturing (March 2003). NBER Working Paper No. w9573, Available at SSRN: https://ssrn.com/abstract=389444

Rachel Griffith (Contact Author)

Institute for Fiscal Studies (IFS) ( email )

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+44 20 7323 4780 (Fax)

University of Manchester ( email )

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HOME PAGE: http://www.ifs.org.uk/people/profile?id=37

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Helen Simpson

CMPO ( email )

University of Bristol
2 Priory Road
Bristol, BS8 ITX
United Kingdom

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom
+44 20 7291 4800 (Phone)
+44 20 7323 4780 (Fax)

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