Publication

This paper addresses the consequences of workers' exchange between plants in different countries belonging to multinational corporations. The authors explain that by exchanging workers, multinational corporations can draw on a larger labor market pool, reducing the mismatch of their workforce. The paper analyzes the consequences of this advantage for production, employment and, most prominently, wages. The authors are able to disentangle the effects of worker heterogeneity and firm heterogeneity on wages and show that the latter is important to explain why multinationals typically pay higher wages.