The Innovation‐employment Nexus: A Critical Survey of Theory and Empirics

Calvino, Flavio; Virgillito, Maria Enrica

doi:10.1111/joes.12190

Cited by 162 publications

(153 citation statements)

References 115 publications

(172 reference statements)

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“…17 However, heterogeneities are identified between different types of innovation. While there seems to be a consensus on the positive relationship between product innovation and employment creation, the evidence of the impact of process innovation is mixed (recent reviews of theoretical and empirical evidence are provided by Calvino and Virgillito, 2017;see Oberdabernig, 2016, for a list of studies). As for the impact of marketing and organizational innovations on employment, this topic has been less analysed.…”

Section: Studies Find An Increase In Employment In Innovative Firms mentioning

confidence: 99%

Innovation in firms and labour market outcomes

Richiardi¹,

Postolachi²

2017

World Employ Soc Outlook

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This chapter explores how innovation in firms (described as product, process, marketing and organizational innovation) is associated with firm performance and labour market outcomes. For this purpose, it first discusses the evidence to date at the aggregate (i.e. country) level – for as broad a set of economies as possible. Then, it focuses on the firm level based on a group of economies for which data from the Business Environment and Enterprise Performance Surveys (BEEPS) and MENA Enterprise Surveys (MENA ES) – surveys of transition and Middle East and North Africa (MENA) economies, respectively – are available. The chapter finds that there are considerable differences between innovative and non‐innovative firms: innovative firms tend to be more productive, create more jobs, employ more skilled workers (meaning that they employ more educated workers and offer more training) and hire more female workers. Yet, in some cases innovation is associated with more intense use of temporary workers (especially in firms that implement product and process innovations). Moreover, it has been found that sectoral differences might play a role. In this regard, considerable job contraction is observed in non‐innovative low‐technology firms in the manufacturing sector, highlighting the high risk of job loss among low‐skilled workers. Regarding sources of innovation, the chapter shows that while R&D engagement is an important determinant of successful innovation, other drivers, including training, public funding and external acquisition of technologies are relevant. On the basis of these findings, the chapter suggests that adequate education, training and social protection policies can play an important role in both fostering innovation and preparing workers (and firms) effectively for the changing job environment. This means that social partners and other stakeholders will be required to participate in reflections on the types of jobs and skills that will be relevant in the future.

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Section: Studies Find An Increase In Employment In Innovative Firms mentioning

confidence: 99%

Innovation in firms and labour market outcomes

Richiardi¹,

Postolachi²

2017

World Employ Soc Outlook

View full text Add to dashboard Cite

show abstract

“…Although there is growing evidence that innovation creates jobs (see, for instance, Calvino & Virgillito, 2017), the fear that the development of new technology will generate unprecedented job destruction is more widespread than ever. Consequently, the relationship between innovation and employment is nowadays at the core of the policy debate.…”

Section: Introductionmentioning

confidence: 99%

Do Labor Market Regulations Affect the Link between Innovation and Employment? Evidence from Latin America

Baensch

Lanzalot

Lotti

et al. 2019

The B.E. Journal of Economic Analysis &Amp; Policy

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This paper sheds light on how labor market regulations affect the relationship between different types of innovation and employment in Latin America. We estimate the effect of process and product innovation on employment growth using Enterprise Surveys for 14 Latin American countries. We calculate the model for the whole sample and then classify countries according to the rigidness of their labor market regulations. We find that: (i) product innovations have a positive impact on employment growth; (ii) process innovations do not affect employment growth; and (iii) more rigid labor market regulations (minimum wages and severance payments) reduce the effects of innovation.

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“…Numerous firm-level studies, mainly based on data for the manufacturing sector, conclude that product innovations have a positive impact on employment, while the effects of process innovations are more ambiguous (Van Reenen, 1997;Peters, 2008, 2014;Vivarelli, 2013, 2014and Calvino and Virgillito, 2017 for summaries of recent research). Despite the well-known advantages of longitudinal data, these studies seldom use dynamic panel data methods (for recent exceptions see Lachenmaier and Rottmann, 2011;Bogliacino, Piva and Vivarelli, 2012).…”

Section: Introductionmentioning

confidence: 99%

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

Falk

Hagsten

2017

Eurasian Bus Rev

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This study investigates the impact of new market product (market novelty) sales on labour demand (employment). Based on a two-output cost function (market novelties and existing products) a relative employment equation is derived with the ratio of labour to material inputs as dependent variables. The relative labour demand model is estimated using biennial data for 25 industries, nine European countries and five time periods (2002-2010) or by use of a sizeclass dataset with broad industry groups. System GMM estimations accounting for endogeneity show that the turnover (sales) of market novelties (in relation to existing products) has a significant impact on relative employment in manufacturing industries. On average, an increase in the relative turnover of new market products by one percentage point is associated with a 1.6 per cent increase in the employment ratio. In contrast, employment in service industries does not benefit from new market products but instead from the intensity with which information and communication technology innovations are used, approximated by the proportion of broadband internet connected employees. When instead the size-class dataset is employed, it becomes clear that market novelties primarily drive employment in small firms.

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The Innovation‐employment Nexus: A Critical Survey of Theory and Empirics

Cited by 162 publications

References 115 publications

Innovation in firms and labour market outcomes

Innovation in firms and labour market outcomes

Do Labor Market Regulations Affect the Link between Innovation and Employment? Evidence from Latin America

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

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