In analyzing the distinctive contributions of foreign subsidiaries and domestic firms to productivity growth in Belgian manufacturing, this paper shows that foreign ownership is an important source of firm heterogeneity affecting productivity dynamics. Foreign firms are found to have contributed disproportionately to aggregate productivity growth while reallocation processes are reported to be significantly different among foreign subsidiaries and domestic firms.

Firm heterogeneity, Multinational firms, Productivity,
Economics Letters
Erasmus Research Institute of Management

de Backer, K, & Sleuwaegen, L.I.E. (2003). Foreign ownership and productivity dynamics. Economics Letters, 79(2), 177–183. doi:10.1016/S0165-1765(02)00323-3