IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

The Impact of Innovation on Employment in Small and Medium Enterprises with Different Growth Rates

  • Volker Zimmermann

    ()

    (KfW Bankengruppe, Frankfurt am Main)

Registered author(s):

    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.

    File URL: http://www.wiso-net.de/webcgi?START=A60&DOKV_DB=ZECO&DOKV_NO=JFNSJFNS2009050031329171418222510122&DOKV_HS=0&PP=1
    File Function: Main text
    Download Restriction: Access via GENIOS - German Business Information - http://www.genios.de/r_startseite/index.ein

    File URL: http://search.ebscohost.com/login.aspx?direct=true&db=ecn&AN=1053132&site=ehost-live
    File Function: Main text
    Download Restriction: Access via EBSCOhost Econlit - http://www.ebscohost.com/

    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.

    Article provided by Justus-Liebig University Giessen, Department of Statistics and Economics in its journal Journal of Economics and Statistics.

    Volume (Year): 229 (2009)
    Issue (Month): 2-3 (June)
    Pages: 313-326

    as
    in new window

    Handle: RePEc:jns:jbstat:v:229:y:2009:i:2-3:p:313-326
    Contact details of provider: Postal: Licher Straße 74, 35394 Gießen
    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.:

    as in new window
    1. Utterback, James M & Abernathy, William J, 1975. "A dynamic model of process and product innovation," Omega, Elsevier, vol. 3(6), pages 639-656, December.
    2. 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).
    3. 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.
    4. Evans, David S., 1986. "Tests of Alternative Theories of Firm Growth," Working Papers 86-36, C.V. Starr Center for Applied Economics, New York University.
    5. 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.
    6. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
    7. 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, October.
    8. 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.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    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 you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.