The impact of multinational affiliates on host country workers and plants depends on the structure of the labor market. We use matched employer-employee data for Norway to show that the labor market is characterized by a job ladder, and that multinationals are located on the upper rungs of this ladder. We build a general equilibrium job ladder model with costly entry by multinationals, and calibrate it to match features of the Norwegian labor market. The size distribution of multinational affiliates implies that they are more productive than local plants. We use the calibrated model to show that restricting entry of multinationals therefore makes the job ladder less steep.

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