Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259480 
Year of Publication: 
2021
Series/Report no.: 
ADB Economics Working Paper Series No. 642
Publisher: 
Asian Development Bank (ADB), Manila
Abstract: 
This paper explores the job creation impacts of the large foreign direct investment (FDI) inflows to Mongolia's non-resource sector following the signing of the investment agreement for the Oyu Tolgoi mine in 2009. Using FDI project and national employment data over 2009-2013, we employ a triple difference methodology on the sector-province (aimag)-year level. The results suggest that each FDI job and every $1 million FDI inflow displace 5.5 and 20 local jobs, respectively. Several factors may explain this result: the majority of FDI was targeted at sectors such as transportation and retail where efficiency gains led to job losses; the low skill-intensity of FDI jobs in those sectors; the low labor supply elasticity in Ulaanbaatar where most of the FDI projects are concentrated; and the limited extent of localized supply chains.
Subjects: 
resource boom
foreign direct investment
local job multiplier
Mongolia
JEL: 
F21
J21
O11
Q32
Q33
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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