R&D and Innovation Activities and the Use of External Numerical Flexibility
AbstractWe study the impact of R&D and innovation on the use of external numerical flexibility (ENF). R&D and innovation imply both a higher average and a higher volatile productivity. We investigate this ambiguous effect on the firm preference for using ENF in two steps. First, we use a simple model to show that a first-order stochastic dominance shift in the distribution function increases the probability of hiring permanent workers, while a second-order shift has ambiguous effects. Next, using a dataset based on a survey of Italian manufacturing firms, we run logit regressions to estimate the effect of R&D and innovation on the probability of employing a fixed-term or a TWA worker, finding a positive and always significant effect. We also consider internal and external R&D and different types of innovation. Results show that the former has a positive effect while the latter depends on the type of innovation.
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Bibliographic InfoPaper provided by University of Rome La Sapienza, Department of Public Economics in its series Working Papers with number 150.
Date of creation: Nov 2011
Date of revision:
Flexible employment; Labor contracts; Research and Development; Innovation.;
Find related papers by JEL classification:
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-02-27 (All new papers)
- NEP-CSE-2012-02-27 (Economics of Strategic Management)
- NEP-INO-2012-02-27 (Innovation)
- NEP-KNM-2012-02-27 (Knowledge Management & Knowledge Economy)
- NEP-SBM-2012-02-27 (Small Business Management)
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