The Impact of Innovation on Employment in Small and Medium Enterprises with Different Growth Rates
This article examines the impact of innovation on employment growth in innovating small and medium enterprises. In contrast to existing studies, which typically use the least squares estimation technique, quantile regressions were carried out to analyse the data. This method allows one to examine the effects of innovation at any desired point on the distribution function – for example, in firms experiencing positive or negative growth – providing a more complete picture of the relationship between innovation and employment growth than the standard method of viewing deviations in the average effect. The key finding of the study is that innovation has a positive effect on employment in both growing and shrinking small and medium enterprises. In addition, innovation has a much stronger impact on employee headcounts in companies that are already experiencing strong growth than in their slower growing or shrinking counterparts. When differentiating between product and process innovations, the analysis shows that the introduction of new or improved processes has a larger impact on employment than product innovations. Thus, positive employment effects of innovations are not restricted to narrow segments of the economy. Economic policy aimed at bolstering the innovative strength of firms is thus a strong encouragement to employment on a broad basis.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 229 (2009)
Issue (Month): 2-3 (June)
|Contact details of provider:|| Postal: |
Phone: +49 (0)641 99 22 001
Fax: +49 (0)641 99 22 009
Web page: http://wiwi.uni-giessen.de/home/oekonometrie/Jahrbuecher/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gaskins, Darius Jr., 1971. "Dynamic limit pricing: Optimal pricing under threat of entry," Journal of Economic Theory, Elsevier, vol. 3(3), pages 306-322, September.
- Evans, David S., 1986.
"Tests of Alternative Theories of Firm Growth,"
86-36, C.V. Starr Center for Applied Economics, New York University.
- Welsch, Johann, 2006. "Paradigmenwechsel beim Zusammenhang von Innovation und Beschäftigung?," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1998 - 2007), ZBW – German National Library of Economics / Leibniz Information Centre for Economics, vol. 86(12), pages 811-820.
- Utterback, James M & Abernathy, William J, 1975. "A dynamic model of process and product innovation," Omega, Elsevier, vol. 3(6), pages 639-656, December.
- Stefan Lachenmaier & Horst Rottmann, 2006.
"Employment Effects of Innovation at the Firm Level,"
Ifo Working Paper Series
Ifo Working Papers No. 27, Ifo Institute for Economic Research at the University of Munich.
- Stefan Lachenmaier & Horst Rottmann, 2007. "Employment Effects of Innovation at the Firm Level," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 227(3), pages 254-272, June.
- Rottmann, Horst & Lachenmaier, Stefan, 2007. "Employment effects of innovation at the firm level," OTH im Dialog: Weidener Diskussionspapiere 3, University of Applied Sciences Amberg-Weiden (OTH).
- Stefan Lachenmaier, 2007. "Effects of innovation on firm performance," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute for Economic Research at the University of Munich, number 28.
- Gort, Michael & Klepper, Steven, 1982. "Time Paths in the Diffusion of Product Innovations," Economic Journal, Royal Economic Society, vol. 92(367), pages 630-53, September.
- Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
When requesting a correction, please mention this item's handle: RePEc:jns:jbstat:v:229:y:2009:i:2-3:p:313-326. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Winker)
If references are entirely missing, you can add them using this form.