This paper investigates the effects of the takeover of a domestic establishment by foreign owners on the domestic target's development of wages for skilled and unskilled workers. We pay particular attention to identifying the causal effect, using a propensity score matching approach combined...

We use a panel of more than 100 countries for the period 1980 to 2002 to analyse the relationship between inward foreign direct investment (FDI) and wage inequality. We particularly check whether this relationship is non-linear, in line with a theoretical discussion. We find that the effect of...