However, several confounding issues make pinpointing
any precise wage premium paid by MNEs over domestic
firms a difficult task: MNEs could be selectively
hiring more productive workers, or MNEs could be concentrated
in industries that pay higher wages. Harrison
and Rodrı´guez-Clare (2011) survey the literature on FDI
and wages and find that the ‘unconditional’ wage gap, or
the gap between wages in foreign and domestic firms
with no controls for biases, is as high as 50%. However,
after adjusting for firm and worker characteristics, they
conclude that foreign firms pay a small wage premium
of between 5% and 10% higher than those paid by domestic
firms.