Innovation, creative destruction and structural change: firm-level evidence from European countries

Abstract

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Innovation, Creative Destruction and Structural Change: Firm-level Evidence from European Countries AbstractThe shift of employment from lower to higher productive firms is an important driver for structural change and industry dynamics. We investigate this reallocation in terms of employment gains and losses from innovation. New employment created by product innovation may be offset by employment losses in related products, known as 'cannibalisation' or 'business stealing' effects in the literature, by employment losses from process and organisational innovation and by general productivity increases. The paper investigates this effect empirically with a large dataset from the European Community Innovation Survey (CIS). We find that employment gains and losses increase with technology intensity of the sector. Hightechnology manufacturing shows the strongest employment gains and losses from innovation, followed by knowledge-intensive services, low-technology manufacturing and less knowledge-intensive services.The net contribution of innovation to employment growth is mostly positive, an exception being manufacturing industries in recession periods.JEL: O33, J23, C26, D2

Industrial Innovation, Labour Productivity, Sales and Employment

“…At the same time these product innovations may cannibalise on the old products. In order to create a positive effect on employment, the compensation effect of additional sales (and hence employment) of product innovations needs to outweigh the cannibalisation effect (Dachs et al 2017). The effect may also include a negative externality on other firms, the business stealing effect.…”

“…In explaining employment Harrison et al (2014) and Dachs et al (2017) differentiate between displacement effects, compensations effects, cannibalisation effects and (at industry level) business stealing effects. They show also that the mechanisms may be different during different parts of the business cycle.…”

“…One of the few studies that differentiates explicitly between effects on sales and productivity with a theoretical production function based approach is Harrison et al (2014), while Dachs et al (2017), Dachs and Peters (2014), Hall, Lotti, and Mairesse (2008) and Peters (2008) use the same approach. Harrison et al (2014) use individual company CIS data to estimate an equation that explains employment by sales, product innovation and process innovation.…”

The Impact of the Innovation Ecosystem on Economic Diversification of Region

“…В отраслевом разрезе проблема анализировалась Malerba и Montobbio (2004), которые продемонстрировали, что опережающие темпы роста патентных заявок влияют на динамику роста соответствующей отрасли, а узкая специализация национальных инновационных экосистем на конкретных технологических классах усиливает степень концентрации экономики. В исследовании Dachs et al (2017) показано, что продуктовые инновации в силу многих причин не приводят к структурным сдвигам занятости. разграничили варианты влияния инновационной экосистемы на структурные сдвиги.…”

Employment impacts of market novelty sales: evidence for nine European Countries

“…Microdata studies demonstrate that firms introducing new products (market novelties) tend to create more jobs than non-innovative ones (Van Reenen, 1997;Greenan and Guellec, 2000;Peters, 2008, 2014;Vezzani, 2010, 2012;Lachenmaier and Rottmann, 2011;Dachs and Peters, 2014;Dachs et al, 2016Dachs et al, , 2017.…”