Growing from Within: Multinational Linkages and Internal Reorganization in Supplier Firms

When a domestic firm becomes a supplier to a multinational, how does it reorganize the work inside its walls? This paper studies the internal reorganization of supplier firms following the formation of multinational linkages, using administrative microdata from Türkiye. Becoming a multinational’s supplier reshapes the occupational composition of the workforce: suppliers expand clerical and administrative employment, raising occupational diversity and the skill and task content of work. The resulting wage premium is an organizational effect rather than a mechanical consequence of scale. These results provide new evidence on a labor-market channel through which multinational linkages upgrade firm organization in a middle-income economy.

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