Marc-Andreas Muendler§

Novel linked employer-employee data for multinational enterprises and their global workforces show that multinational enterprises that expand abroad re-tain more domestic jobs than competitors without foreign expansions. Pro-pensity-score estimation demonstrates that the foreign expansion itself is a dominant explanatory factor for reduced worker separation rates. Bounding, concomitant variable tests, and further robustness checks show competing hy-potheses to be less plausible. The finding is consistent with the hypothesis that, given global wage differences, a prevention of enterprises from outward FDI would lead to more domestic job losses. FDI raises domestic-worker re-tention more pronouncedly among highly educated workers