We exploit the 2011 Japanese natural disaster to investigate the effects of deep disruptions of Japanese parent firms' production activities on South Ko- rean subsidiaries' operations. Using a simple D-i-D specification applied to firms from the KNSO panel database we detail the features of a propagation effect among South Korean firms. We also find evidence of a diversification of sourcing, sale and employment strategies among South Korean subsidiaries after the 2011 disaster, when the relative use of temporary workers decreased. For South Korean subsidiary firms with Japanese parents, the 2011 tsunami had a negative effect on profitability and on liquidity.
4 Apr 2017 → 6 Apr 2017
The 35th International Labour Process Conference, Reconnecting Work and Political Economy