Firm heterogeneity in multinational and domestic firms in Italian logistics

In general it is accepted that foreign multinational enterprises (MNE’s) perform better than domestic firms for a number of performance indicators. Micro level data revealed - especially in manufacturing – MNE’s are larger, more productive and innovative and pay higher wages than domestic firms. Studies on firm heterogeneity refer to the manufacturing sector, while little evidence is provided for other sectors. The present paper examines how logistics firms located in Italy (2002-2005) differ in terms of size, labour productivity and fixed assets, by their ownership structure (foreign MNE versus domestic firms). Specifically is investigated whether foreign MNE do indeed outperform domestic firms on profitability. By propensity score estimation and discrete choice models we compare the performance-indicators of the two types of firms. The results show that the differences among the two groups persist, mainly as concerns turnover and value added, suggesting that foreign MNE have a higher return on capital.