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The employment impact of product innovations in sub-Saharan Africa: Firm-level evidence

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  • Avenyo, Elvis Korku
  • Konte, Maty
  • Mohnen, Pierre

Abstract

Innovation has become a key interest in sub-Saharan Africa (SSA), as it is argued to be pervasive, and plays an eminent role in generating employment. There is, however, a dearth of empirical evidence assessing the impact of innovation on firm employment for SSA. This paper investigates the impact of product innovations on job creation using data from the recent waves of the Enterprise Survey merged with Innovation Follow-Up Survey for SSA countries for which both surveys are available. We apply the Dose Response Model under continuous and heterogeneous responses to treatment. The results reveal a positive impact of product innovations on total employment. This result is, however, found to hold only at specific intervals of product innovation intensities. Our analyses also show that product innovations tend to create both temporary and permanent jobs as well as skilled and unskilled jobs. However, the positive impact of product innovations on temporary and unskilled employment tends to outweigh that of permanent and skilled employment, raising questions about the security and quality of the new jobs generated by product innovations.

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  • Avenyo, Elvis Korku & Konte, Maty & Mohnen, Pierre, 2019. "The employment impact of product innovations in sub-Saharan Africa: Firm-level evidence," Research Policy, Elsevier, vol. 48(9), pages 1-1.
    • Handle: RePEc:eee:respol:v:48:y:2019:i:9:6
    DOI: 10.1016/j.respol.2019.103806
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    2. Elvis Korku Avenyo & Maty Konte & Pierre Mohnen, 2021. "Product innovation and informal market competition in sub-Saharan Africa," Journal of Evolutionary Economics, Springer, vol. 31(2), pages 605-637, April.
    3. Williams, Christopher & Tesfaye Hailemariam, Atsede & Allard, Gayle, 2022. "Exploring entrepreneurial innovation in Ethiopia," Research Policy, Elsevier, vol. 51(10).
    4. Rajeev K. Goel & Michael A. Nelson, 2022. "Employment effects of R&D and process innovation: evidence from small and medium-sized firms in emerging markets," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(1), pages 97-123, March.
    5. Porath, Daniel & Nabachwa, Sarah & Agasha, Ester & Kijjambu, Nsambu Frederick, 2021. "Innovation and employment in Sub-Saharan Africa," UASM Discussion Paper Series 10/2021, University of Applied Sciences Mainz.
    6. Muna Adilah & Hsin Rau & Katrina Mae Procopio, 2023. "Using an Axiomatic Design Approach to Develop a Product Innovation Process with Circular and Smart Design Aspects," Sustainability, MDPI, vol. 15(3), pages 1-24, January.
    7. Mbaye, Linguère Mously & Tani, Massimiliano, 2019. "Migration, Innovation, and Growth: An African Story?," IZA Discussion Papers 12533, Institute of Labor Economics (IZA).
    8. Avenyo, Elvis Korku, 2021. "Learning and Product Innovation Performance in Informal Enterprises: Evidence from Urban Ghana," MPRA Paper 108839, University Library of Munich, Germany, revised 05 May 2021.
    9. Maty Konte & Godsway Korku Tetteh, 2023. "Mobile money, traditional financial services and firm productivity in Africa," Small Business Economics, Springer, vol. 60(2), pages 745-769, February.
    10. Michael Danquah & Solomon Owusu, 2021. "Digital technology and productivity of informal enterprises: Empirical evidence from Nigeria," WIDER Working Paper Series wp-2021-114, World Institute for Development Economic Research (UNU-WIDER).
    11. Keraga, Mezid N. & Stephan, Andreas, 2023. "Does innovation stimulate employment in Africa? New firm-level evidence from the Worldbank Enterprise Survey," Working Paper Series in Economics and Institutions of Innovation 494, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

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    More about this item

    Keywords

    Employment; Product innovations; Dose response model; Sub-Saharan Africa;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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