Foreign Firms, Domestic Wages

Many papers have documented a wage premium in foreign-owned and large firms. However, there is very little formal theory in the literature and empirical analyses are typically not based on hypotheses which are rigorously derived from theory. This paper contributes to the theory-empirics gap by developing a model that allows for two “pure” explanations for the wage premium. The first is a heterogenous-worker explanation along the lines of Yeaple (2005), where firms that select more scaleintensive technologies select ex-ante more productive workers. In this case, the wage premium is a pure selection phenomenon. The second explanation builds on the heterogeneous-firm model of Melitz (2003) combined with on-the-job learning as in Markusen (2001). Productivity differences between firms are internalized by ex-ante homogeneous workers, so the wage premium is a pure learning phenomenon due to ex-post higher productivity in foreign firms. Our model yields a number of precise empirical hypotheses. When these predictions are tested on Danish matched employer-employee data, we find that both explanations play a role in explaining the observed wage premium. Specifically, the foreign- and large-firm premiums explained by selection are in the neighborhood of 30-65% of the total premium, with the remainder consistent with learning. There is also considerable support for a number of other predictions specific to the worker-learning explanation.

Foreign Firms, Domestic Wages

Foreign-owned firms are often hypothesized to generate productivity "spillovers" to the host country, but both theoretical micro-foundations and empirical evidence for this are limited. We develop a heterogeneous-firm model in which ex-ante identical workers learn from their employers in proportion to the firm?s productivity. Foreign-owned firms have, on average, higher productivity in equilibrium due to entry costs, which means that low-productivity foreign firms cannot enter. Foreign firms have higher wage growth and, with some exceptions, pay higher average wages, but not when compared to similarly large domestic firms. The empirical implications of the model are tested on matched employer-employee data from Denmark. Consistent with the theory, we find considerable evidence of higher wages and wage growth in large and/or foreign-owned firms. These effects survive controlling for individual characteristics, but, as expected, are reduced significantly when controlling for unobservable firm heterogeneity. Furthermore, acquired skills in foreign-owned and large firms appear to be transferable to both subsequent wage work and self-employment.

Do Foreign Experts Increase the Productivity of Domestic Firms?

While most countries welcome (and some even subsidise) high-skilled immigrants, there is very limited evidence of their importance for domestic firms. To guide our empirical analysis, we first set up a simple theoretical model to show how foreign experts may impact on the productivity and wages of domestic firms. Using matched worker-firm data from Denmark and a difference-indifferences matching approach, we then find that firms that hire foreign experts – defined as employees eligible for reduced taxation under the Danish "Tax scheme for foreign researchers and key employees" – both become more productive (pay higher wages) and increase their exports of goods and services.foreign experts, export, immigrants, productivity, difference-in-differences matching

Spatiotemporal dynamics in a spatial plankton system

In this paper, we investigate the complex dynamics of a spatial plankton-fish system with Holling type III functional responses. We have carried out the analytical study for both one and two dimensional system in details and found out a condition for diffusive instability of a locally stable equilibrium. Furthermore, we present a theoretical analysis of processes of pattern formation that involves organism distribution and their interaction of spatially distributed population with local diffusion. The results of numerical simulations reveal that, on increasing the value of the fish predation rates, the sequences spots $\rightarrow$ spot-stripe mixtures$\rightarrow$ stripes$\rightarrow$ hole-stripe mixtures holes$\rightarrow$ wave pattern is observed. Our study shows that the spatially extended model system has not only more complex dynamic patterns in the space, but also has spiral waves.Comment: Published Pape

Class of self-limiting growth models in the presence of nonlinear diffusion

The source term in a reaction-diffusion system, in general, does not involve explicit time dependence. A class of self-limiting growth models dealing with animal and tumor growth and bacterial population in a culture, on the other hand are described by kinetics with explicit functions of time. We analyze a reaction-diffusion system to study the propagation of spatial front for these models.Comment: RevTex, 13 pages, 5 figures. To appear in Physical Review

Resonance and frequency-locking phenomena in spatially extended phytoplankton-zooplankton system with additive noise and periodic forces

In this paper, we present a spatial version of phytoplankton-zooplankton model that includes some important factors such as external periodic forces, noise, and diffusion processes. The spatially extended phytoplankton-zooplankton system is from the original study by Scheffer [M Scheffer, Fish and nutrients interplay determines algal biomass: a minimal model, Oikos \textbf{62} (1991) 271-282]. Our results show that the spatially extended system exhibit a resonant patterns and frequency-locking phenomena. The system also shows that the noise and the external periodic forces play a constructive role in the Scheffer's model: first, the noise can enhance the oscillation of phytoplankton species' density and format a large clusters in the space when the noise intensity is within certain interval. Second, the external periodic forces can induce 4:1 and 1:1 frequency-locking and spatially homogeneous oscillation phenomena to appear. Finally, the resonant patterns are observed in the system when the spatial noises and external periodic forces are both turned on. Moreover, we found that the 4:1 frequency-locking transform into 1:1 frequency-locking when the noise intensity increased. In addition to elucidating our results outside the domain of Turing instability, we provide further analysis of Turing linear stability with the help of the numerical calculation by using the Maple software. Significantly, oscillations are enhanced in the system when the noise term presents. These results indicate that the oceanic plankton bloom may partly due to interplay between the stochastic factors and external forces instead of deterministic factors. These results also may help us to understand the effects arising from undeniable subject to random fluctuations in oceanic plankton bloom.Comment: Some typos errors are proof, and some strong relate references are adde

Plankton lattices and the role of chaos in plankton patchiness

Spatiotemporal and interspecies irregularities in planktonic populations have been widely observed. Much research into the drivers of such plankton patches has been initiated over the past few decades but only recently have the dynamics of the interacting patches themselves been considered. We take a coupled lattice approach to model continuous-in-time plankton patch dynamics, as opposed to the more common continuum type reaction-diffusion-advection model, because it potentially offers a broader scope of application and numerical study with relative ease. We show that nonsynchronous plankton patch dynamics (the discrete analog of spatiotemporal irregularity) arise quite naturally for patches whose underlying dynamics are chaotic. However, we also observe that for parameters in a neighborhood of the chaotic regime, smooth generalized synchronization of nonidentical patches is more readily supported which reduces the incidence of distinct patchiness. We demonstrate that simply associating the coupling strength with measurements of (effective) turbulent diffusivity results in a realistic critical length of the order of 100 km, above which one would expect to observe unsynchronized behavior. It is likely that this estimate of critical length may be reduced by a more exact interpretation of coupling in turbulent flows