Growth in advanced economies is essentially driven by innovation activities. From a demographic point of view the question rises, whether the trend of an ageing workforce will affect the innovation capacities of these economies. To answer this question, the paper examines on the basis of a German linked-employer-employee-dataset, whether an older workforce lowers a firm’s potential to generate product innovations. The empirical approach is based on an Ordered-logit regression model, relating a firm’s innovation potential to the age composition of its employees. The analysis provides evidence of significant age effects. The estimated age-innovation-profile follows an inverted-ushaped pattern, it peaks at the age of about 40 years. A separate estimation shows, that the technician’s and engineer’s age seems to be particularly relevant.
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Paper provided by Halle Institute for Economic Research in its series IWH Discussion Papers with number
2-07.
Find related papers by JEL classification: J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives
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Glenn MacDonald & Michael Weisbach, 2001.
"The Economics of Has-Beens,"
NBER Working Papers
8464, National Bureau of Economic Research, Inc.
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