IMPACTS OF ACQUISITIONS AND NEW PLANTS ON THE EMPLOYMENT IN US AFFILIA TES OF FOREIGN MANUFA CTURING FIRMS

Using the polynomially distributed lags model we differentiate, through time, the aggregate impacts of the two major modes of Foreign Direct Investment upon employment within the foreign manufacturing sector in the US. Our results indicate that the impact of FDI is not uniform; it is specific to entry mode. The acquisition of domestic firms by foreign interests appears to have little aggregate positive impact upon employment, while new plants, constructed by foreign concerns, have positive employment impacts on the foreign manufacturing sector in the United States.