Many countries strive to attract foreign direct investment (FDI) hoping that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. While the empirical studies have cast doubt on the existence of horizontal spillovers from FDI in developing...

The paper examines implications of endogenous growth theory on the relationship between firm productivity, innovation as well as productivity growth by combining infirmation on firm-level innovation (CIS) with accounting data for a large sample of Slovenian firms in the period 1996-2002. We...

Using firm-level innovation data for a large sample of Slovenian firms in the period 1996-2002, the paper finds surprising results that innovation is not benefitting all firms. We find that only manufacturing firms with below average productivity growth (the lowest four deciles) are likely to...

This study analyzes the dynamic effect of FDI on local firms' productivity by relaxing the standard implicit assumption that technological spillovers are immediate and pfirmanent. We find that the entry of majority foreign owned firms has a short run negative effect on the productivity of local...

Using a unique data set from the Czech Republic for 1994-2003, this study examines the relationship between a firm's liquidity constraints and its supply linkages with multinational corporations (MNCs). The empirical analysis indicates that Czech firms supplying MNCs are less credit constrained...

A political miracle occurred when Germany was reunited, and at first glance an economic miracle has followed. Real incomes in the east have now reached the western level, and investment per capita has been much higher than in the w est. However, every third deutschmark spent in the east has been...

Can the existence of positive productivity spillovers between co-workers be explained by the presence of complementarities in a firm's production function? A simple model demonstrates that this is possible when workers perform their tasks sequentially and part of individuals' pay is determined...

Using data from 11 main manufacturing industries in 17 OECD countries, this paper empirically investigates the determinants of cross-country differences in the persistence of productivity differentials Specifically, we focus on the effects of product market structure and technology diffusion. It...

We determine workforce composition and wages in firms in the presence of productivity spill-overs between co-workers. In equilibrium, workers' wages depend on the production structure of firms, own group size, and aggregate workforce composition in the firm. We estimate the wage effects of...

Using Difference-in-Differences estimation and data from the European Community Household Panel, this paper suggests that the fixed exchange-rate policy adopted by Italy in the 1997-2000 period has reduced the real hourly wage growth of Italian fulltime workers with permanent contracts, on...