NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Ying-hua Ku

Chung-Hua Institution for Economic Research
No. 75 Chang-Hsing Street
Taipei, Taiwan, 106
REPUBLIC OF CHINA

E-Mail: ku@mail.cier.edu.tw

NBER Working Papers and Publications

August 2005The Effect of Overseas Investment on Domestic Employment
with Tain-Jy Chen
in International Trade in East Asia, NBER-East Asia Seminar on Economics, Volume 14, Takatoshi Ito and Andrew K. Rose, editors
December 2003The Effects of Overseas Investment on Domestic Employment
with Tain-Jy Chen: w10156
In this paper, we study the effects of FDI on domestic employment by examining the data of Taiwan's manufacturing industry. Treating domestic production and overseas production as two distinctive outputs from a joint production function, we may estimate the effect of overseas production on the demand for domestic labor. We found that overseas production generally reduces the demand for domestic labor as overseas products serve as a substitute for primary inputs in domestic production (substitution effect). But overseas production also allows the investor to expand its domestic output through enhanced competitiveness. The expanded domestic output leads to more employment at home (output effect). The net effect of FDI on domestic employment is a combination of substitution and output effects...

Published:

January 2000Foreign Direct Investment and Industrial Restructuring: The Case of Taiwan's Textile Industry
with Tain-Jy Chen
in The Role of Foreign Direct Investment in East Asian Economic Development, NBER-EASE Volume 9, Takatoshi Ito and Anne O. Krueger, editors
 
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