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Innovation and Employment: A Survey

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  • Vivarelli, Marco

    ()
    (Università Cattolica del Sacro Cuore)

Abstract

According to the "compensation theory", market forces should assure a complete compensation of the initial labour-saving impact of process innovations. In this paper a critique of this approach is proposed through a detailed survey of the theoretical and empirical literature on the subject. The general conclusion is that – although compensation is always working – the complete counter-balancing of dismissed workers cannot be assumed ex-ante.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2621.

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Length: 22 pages
Date of creation: Feb 2007
Date of revision:
Publication status: published in: Horst Hanusch and Andreas Pyka (eds.), Elgar Companion to Neo-Schumpeterian Economics, Cheltenham: Elgar, 2007, 719-32
Handle: RePEc:iza:izadps:dp2621

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Related research

Keywords: technological unemployment; compensation; innovation;

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