Open Economies Review

, Volume 16, Issue 2, pp 153–174 | Cite as

Home Employment Effects of EU Firms’ Activities in Central and Eastern European Countries

  • Ludo Cuyvers
  • Michel Dumont
  • Glenn Rayp
  • Katrien Stevens
Article

Abstract

We examine whether or not affiliate production in Central and Eastern Europe (CEEC) affects factor demand in the EU, at the investing firm and sector levels. Using firm level data, we estimate parent labor demand elasticities for a number of manufacturing sectors, following a flexible cost function approach. We find evidence of inter-sector heterogeneity, but not of a substantially greater impact in “low-skilled” intensive sectors. Labor demand in the EU is affected by FDI in the CEEC, both at the investing firm and sector levels. It has a significant sector and non-sector component.

Key words

employment investment multinational firms 

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Copyright information

© Springer Science + Business Media, Inc. 2005

Authors and Affiliations

  • Ludo Cuyvers
    • 1
  • Michel Dumont
    • 1
  • Glenn Rayp
    • 2
  • Katrien Stevens
    • 2
  1. 1.University of Antwerp, Faculty of Applied EconomicsAntwerpBelgium
  2. 2.Ghent University, Faculty of Economics and Business Administration and SHERPPAGhentBelgium

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