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Contents Introduction

This paper investigates the effects of foreign worker shares and MNE ownership on wages paid to males and female in five occupation groups in Malaysian manufacturing plants during 1994-1996, an important period coinciding with the end of the decade-long economic boom that preceded the Asian financial crisis. Random effects estimates of Mincer-type equations by occupation group and sex in large samples of all industries and in seven industry-level samples both suggest that use of foreign workers generally had insignificant effects on plant wages for most occupation-sex-(and industry) combinations. When significant, these estimates suggested that plants with relatively large shares of same sex-same occupation foreign worker shares tended to pay relatively high wages to relatively high wages to high-wage workers but relatively low wages to low-wage workers. The few significant effects of foreign workers of the different sex and same occupation and in different occupations were less systematic. Conditional MNE-local wage differentials were almost always positive when significant. Results from large samples of all industries combined indicate a strong tendency for MNEs to pay relatively high wages. However, allowing all slope coefficients to vary among seven industry groups suggests that MNE-local differentials were almost always insignificant in three industries and consistently significant in only one.