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The job creation effect of R&D expenditures

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  • Francesco Bogliacino

    ()
    (European Commission, JRC-IPTS)

  • Marco Vivarelli

    ()
    (Università Cattolica)

Abstract

In this study we use a unique database covering 25 manufacturing and service sectors for 16 European countries over the period 1996-2005, for a total of 2,295 observations, and apply GMM-SYS panel estimations of a demand-for-labour equation augmented with technology. We find that R&D expenditures have a job-creating effect, in accordance with the previous theoretical and empirical literature discussed in the paper. Interestingly enough, the labour-friendly nature of R&D emerges in both the flow and the stock specifications. These findings provide further justification for the European Lisbon-Barcelona targets.

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Bibliographic Info

Paper provided by Institut d'Economia de Barcelona (IEB) in its series Working Papers with number 2010/55.

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Length: 27 pages
Date of creation: 2010
Date of revision:
Handle: RePEc:ieb:wpaper:2011/1/doc2010-55

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Related research

Keywords: Technological change; corporate R&D; employment; product innovation; GMMSYS;

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References

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  1. Brouwer, E. & Kleinknecht, Alfred & Reijnen, J.O.N., 1993. "Employment growth and innovation at the firm level," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5662246, Tilburg University.
  2. Vivarelli, Marco & Evangelista, Rinaldo & Pianta, Mario, 1996. "Innovation and employment in Italian manufacturing industry," Research Policy, Elsevier, vol. 25(7), pages 1013-1026, October.
  3. Mariacristina Piva & Marco Vivarelli, 2004. "Technological change and employment: some micro evidence from Italy," Applied Economics Letters, Taylor & Francis Journals, vol. 11(6), pages 373-376.
  4. Richard Blundell & Steve Bond, 1999. "GMM estimation with persistent panel data: an application to production functions," IFS Working Papers W99/04, Institute for Fiscal Studies.
  5. Parisi, Maria Laura & Schiantarelli, Fabio & Sembenelli, Alessandro, 2006. "Productivity, innovation and R&D: Micro evidence for Italy," European Economic Review, Elsevier, vol. 50(8), pages 2037-2061, November.
  6. Blundell, R. & Bond, S., 1995. "Initial Conditions and Moment Restrictions in Dynamic Panel Data Models," Economics Papers 104, Economics Group, Nuffield College, University of Oxford.
  7. Bronwyn H. Hall, 2010. "Measuring the Returns to R&D: The Depreciation Problem," NBER Chapters, in: Contributions in Memory of Zvi Griliches, pages 341-381 National Bureau of Economic Research, Inc.
  8. Tommaso Antonucci & Mario Pianta, 2002. "Employment Effects of Product and Process Innovation in Europe," International Review of Applied Economics, Taylor & Francis Journals, vol. 16(3), pages 295-307.
  9. Mariacristina Piva & Marco Vivarelli, 2005. "Innovation and Employment: Evidence from Italian Microdata," Journal of Economics, Springer, vol. 86(1), pages 65-83, October.
  10. Vivarelli, Marco, 2007. "Innovation and Employment: A Survey," IZA Discussion Papers 2621, Institute for the Study of Labor (IZA).
  11. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September.
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  13. Sinclair, Peter J N, 1981. "When Will Technical Progress Destroy Jobs?," Oxford Economic Papers, Oxford University Press, vol. 33(1), pages 1-18, March.
  14. Thomas Hatzichronoglou, 1997. "Revision of the High-Technology Sector and Product Classification," OECD Science, Technology and Industry Working Papers 1997/2, OECD Publishing.
  15. Dobbs, I M & Hill, M B & Waterson, M, 1987. "Industrial Structure and the Employment Consequences of Technical Change," Oxford Economic Papers, Oxford University Press, vol. 39(3), pages 552-67, September.
  16. Van Reenen, John, 1997. "Employment and Technological Innovation: Evidence from U.K. Manufacturing Firms," Journal of Labor Economics, University of Chicago Press, vol. 15(2), pages 255-84, April.
  17. Bogliacino, Francesco & Pianta, Mario, 2010. "Innovation and Employment: a Reinvestigation using Revised Pavitt classes," Research Policy, Elsevier, vol. 39(6), pages 799-809, July.
  18. Neary, J Peter, 1981. "On the Short-Run Effects of Technological Progress," Oxford Economic Papers, Oxford University Press, vol. 33(2), pages 224-33, July.
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  20. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 277-97, April.
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  22. Francesco Aiello & Paola Cardamone, 2008. "R&D spillovers and firms’ performance in Italy," Empirical Economics, Springer, vol. 34(1), pages 143-166, February.
  23. Hall, P. H. & Heffernan, S. A., 1985. "More on the employment effects of innovation," Journal of Development Economics, Elsevier, vol. 17(1-2), pages 151-162.
  24. Ronald Schettkat, 1997. "Book Review," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 153(2), pages 434-435, June.
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  26. Petit, Pascal, 1993. "Employment and technical change," CEPREMAP Working Papers (Couverture Orange) 9330, CEPREMAP.
  27. Brouwer, Erik & Kleinknecht, Alfred & Reijnen, Jeroen O N, 1993. "Employment Growth and Innovation at the Firm Level," Journal of Evolutionary Economics, Springer, vol. 3(2), pages 153-59, May.
  28. repec:sae:niesru:v:111:y::i:1:p:62-85 is not listed on IDEAS
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Citations

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Cited by:
  1. repec:idb:brikps:61058 is not listed on IDEAS
  2. Antonio Vezzani & Sandro Montresor, 2013. "The production function of top R&D investors: Accounting for size and sector heterogeneity with quantile estimations," JRC-IPTS Working Papers on Corporate R&D and Innovation 2013-02, Institute of Prospective Technological Studies, Joint Research Centre.
  3. Vivarelli, Marco, 2014. "Structural Change and Innovation as Exit Strategies from the Middle Income Trap," IZA Discussion Papers 8148, Institute for the Study of Labor (IZA).
  4. Vivarelli, Marco, 2012. "Innovation, Employment and Skills in Advanced and Developing Countries: A Survey of the Literature," IZA Discussion Papers 6291, Institute for the Study of Labor (IZA).
  5. Horst Feldmann, 2013. "Technological unemployment in industrial countries," Journal of Evolutionary Economics, Springer, vol. 23(5), pages 1099-1126, November.
  6. Francesco Bogliacino & Mariacristina Piva & Marco Vivarelli, 2011. "Job Creation Effects of R&D Expenditures: Are High-tech Sectors the Key?," JRC-IPTS Working Papers on Corporate R&D and Innovation 2011-10, Institute of Prospective Technological Studies, Joint Research Centre.

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