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R&D and Employment: Some Evidence from European Microdata

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  • Bogliacino, Francesco

    (Universidad EAFIT)

  • Piva, Mariacristina

    (Università Cattolica del Sacro Cuore)

  • Vivarelli, Marco

    (Università Cattolica del Sacro Cuore)

Abstract

After discussing theory regarding the consequences of technological change on employment and surveying previous microeconometric literature, our aim with this paper is to test the possible job creation effect of business R&D expenditures, using a unique longitudinal database covering 677 European manufacturing and service firms over the period 1990-2008. The main outcome from the whole sample dynamic LSDVC (Least Squared Dummy Variable Corrected) estimate is the labour-friendly nature of companies’ R&D, the coefficient of which turns out to be statistically significant, although not very large in magnitude. However, the positive and significant impact of R&D expenditures on employment is detectable in services and high-tech manufacturing but absent in the more traditional manufacturing sectors. This means that we should not expect positive employment effects from increasing R&D in the majority of industrial sectors. This is something that should be borne in mind by European innovation policy makers having employment as one of their specific aims.

Suggested Citation

  • Bogliacino, Francesco & Piva, Mariacristina & Vivarelli, Marco, 2011. "R&D and Employment: Some Evidence from European Microdata," IZA Discussion Papers 5908, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp5908
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    Cited by:

    1. Lim, Jisun & Lee, Keun, 2019. "Employment effect of innovation under different market structures: Findings from Korean manufacturing firms," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 606-615.
    2. Kristina Matuzeviciute & Mindaugas Butkus & Akvile Karaliute, 2017. "Do Technological Innovations Affect Unemployment? Some Empirical Evidence from European Countries," Economies, MDPI, vol. 5(4), pages 1-19, December.
    3. Gustavo Crespi & Ezequiel Tacsir & Mariano Pereira, 2019. "Effects of innovation on employment in Latin America," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 28(1), pages 139-159.
    4. Bogliacino, Francesco & Piva, Mariacristina & Vivarelli, Marco, 2012. "R&D and employment: An application of the LSDVC estimator using European microdata," Economics Letters, Elsevier, vol. 116(1), pages 56-59.
    5. Vivarelli, Marco, 2012. "Innovation, Employment and Skills in Advanced and Developing Countries: A Survey of the Literature," IZA Discussion Papers 6291, Institute of Labor Economics (IZA).
    6. Swati Mehta, 2016. "Innovation and Employment: A Study of Indian Manufacturing Sector," Millennial Asia, , vol. 7(2), pages 184-206, October.
    7. Di Cintio, Marco & Ghosh, Sucharita & Grassi, Emanuele, 2017. "Firm growth, R&D expenditures and exports: An empirical analysis of italian SMEs," Research Policy, Elsevier, vol. 46(4), pages 836-852.

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    More about this item

    Keywords

    services; innovation; employment; manufacturing; LSDVC;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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