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Unemployment and Innovation Patterns: The Critical Role of Coordination

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  • Gatti, Donatella

Abstract

This paper explores cross-country differences in unemployment and innovation patterns from the perspective of "comparative institutional analysis". A generalized efficiency wage model is proposed for the determination of equilibrium unemployment and innovation within two alternative scenarios: firms coordinating through either market mechanisms or social networks. The mode of coordination is shown to affect firms' choices of either radical or incremental innovations and their responses to competitive pressure. Higher unemployment may result as a consequence of specialization along innovation trajectories that increase job precariousness. Copyright 2000 by Oxford University Press.

Suggested Citation

  • Gatti, Donatella, 2000. "Unemployment and Innovation Patterns: The Critical Role of Coordination," Industrial and Corporate Change, Oxford University Press, vol. 9(3), pages 521-544, September.
  • Handle: RePEc:oup:indcch:v:9:y:2000:i:3:p:521-44
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    Cited by:

    1. Donatella Gatti, 2009. "Macroeconomic effects of ownership structure in OECD countries ," Industrial and Corporate Change, Oxford University Press, vol. 18(5), pages 901-928, October.
    2. Gatti, Donatella, 2000. "Competence, knowledge, and the labour market: the role of complementarities," Discussion Papers, Research Unit: Economic Change and Employment FS I 00-302, Social Science Research Center Berlin (WZB).
    3. Horst Feldmann, 2013. "Technological unemployment in industrial countries," Journal of Evolutionary Economics, Springer, vol. 23(5), pages 1099-1126, November.

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