published in: Review of World Economics, 2007, 143(3), 464-482
Foreign-owned firms have consistently been found to pay higher wages than domestic firms
to what appear to be equally productive workers in both developed and developing countries
alike. Although a number of studies have documented and some attempted to explain this
stylized fact, the issue still remains unresolved. In a multi-period bargaining framework we
show that if firm specific training is more productive in foreign firms, foreign firm workers will
have a steeper wage profile and thus acquire a premium over time. Using a rich employeremployee
matched data set we show 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.
We use cookies to provide you with an optimal website experience. This includes cookies that are necessary for the operation of the site as well as cookies that are only used for anonymous statistical purposes, for comfort settings or to display personalized content. You can decide for yourself which categories you want to allow. Please note that based on your settings, you may not be able to use all of the site's functions.
Cookie settings
These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.
In order to further improve our offer and our website, we collect anonymous data for statistics and analyses. With the help of these cookies we can, for example, determine the number of visitors and the effect of certain pages on our website and optimize our content.