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The Job Creation Effect of R&D Expenditures

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Author Info

  • Bogliacino, Francesco

    () (Universidad EAFIT)

  • Vivarelli, Marco

    () (Università Cattolica del Sacro Cuore)

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 Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4728.

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Length: 22 pages
Date of creation: Jan 2010
Date of revision:
Publication status: published in: Australian Economic Papers, 2012, 51 (2), 96-113
Handle: RePEc:iza:izadps:dp4728

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Related research

Keywords: employment; corporate R&D; technological change; product innovation; GMM-SYS;

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References

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  1. Andrea Conte & Marco Vivarelli, 2006. "One or Many Knowlede Production Functions? Mapping Innovative Activity Using Microdata," Papers on Entrepreneurship, Growth and Public Policy 2006-03, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
  2. Hall, Bronwyn H. & Mairesse, Jacques, 1995. "Exploring the relationship between R&D and productivity in French manufacturing firms," Journal of Econometrics, Elsevier, vol. 65(1), pages 263-293, January.
  3. 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.
  4. 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.
  5. 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.
  6. Petit, Pascal, 1993. "Employment and technical change," CEPREMAP Working Papers (Couverture Orange) 9330, CEPREMAP.
  7. Mariacristina Piva & Marco Vivarelli, 2005. "Innovation and Employment: Evidence from Italian Microdata," Journal of Economics, Springer, vol. 86(1), pages 65-83, October.
  8. 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.
  9. Rinaldo Evangelista & Maria Savona, 2002. "The Impact of Innovation on Employment in Services: Evidence from Italy," International Review of Applied Economics, Taylor and Francis Journals, vol. 16(3), pages 309-318.
  10. 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.
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  12. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September.
  13. 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.
  14. 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.
  15. Mariacristina Piva & Marco Vivarelli, 2004. "Technological change and employment: some micro evidence from Italy," Applied Economics Letters, Taylor and Francis Journals, vol. 11(6), pages 373-376.
  16. Vivarelli, Marco, 2007. "Innovation and Employment: A Survey," IZA Discussion Papers 2621, Institute for the Study of Labor (IZA).
  17. Richard Blundell & Steve Bond, 1995. "Initial conditions and moment restrictions in dynamic panel data models," IFS Working Papers W95/17, Institute for Fiscal Studies.
  18. Vivarelli, Marco & Evangelista, Rinaldo & Pianta, Mario, 1996. "Innovation and employment in Italian manufacturing industry," Research Policy, Elsevier, vol. 25(7), pages 1013-1026, October.
  19. Bogliacino, Francesco & Pianta, Mario, 2010. "Innovation and Employment: a Reinvestigation using Revised Pavitt classes," Research Policy, Elsevier, vol. 39(6), pages 799-809, July.
  20. 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.
  21. Thomas Hatzichronoglou, 1997. "Revision of the High-Technology Sector and Product Classification," OECD Science, Technology and Industry Working Papers 1997/2, OECD Publishing.
  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. Tommaso Antonucci & Mario Pianta, 2002. "Employment Effects of Product and Process Innovation in Europe," International Review of Applied Economics, Taylor and Francis Journals, vol. 16(3), pages 295-307.
  24. 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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Citations

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Cited by:
  1. Marco Vivarelli, 2011. "Innovation, Employment and Skills in Advanced and Developing Countries: A Survey of the Literature," IDB Publications 61058, Inter-American Development Bank.
  2. 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.

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