The presumed higher productivity of foreign firms and resulting spillovers to domestic firms has led governments to offer financial incentives to foreign firms. We investigate if there is any productivity or wage gap between foreign and domestic firms in the UK and if the presence of foreign...

<link rid="b4">Bernard and Jones (1996)</link> have previously argued that similarity in the technologies used by firms in the service sector helps to explain evidence of absolute convergence at the cross-country level. This paper searches for convergence at the firm level using data for the UK service sector over...