Spillovers from Foreign Firms through Worker Mobility: An Empirical Investigation*

Abstract While there is a large empirical literature on productivity spillovers from multinationals, this literature treats the channels through which these spillover effects work as a black box. The new approach in this paper is to investigate whether spillovers occur via worker mobility. We use data on whether or not the owner of a domestic firm has previous experience in a multinational, and relate this information to firm‐level productivity. Our results suggest that firms which are run by owners who worked for multinationals in the same industry immediately prior to opening up their own firm are more productive than other domestic firms.