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Patterns of innovation and wage distribution. Do “innovative firms” pay higher wages? Evidence from Chile

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  • Valeria Cirillo

Abstract

In this paper we investigate the innovative patterns of Chilean productive sectors applying multivariate analysis methods such as factor and cluster analysis. Three main patterns are detected in our sample according to the type of innovation introduced and the motivation behind it: product strategy innovators, cost strategy innovators and non-innovators. Starting on this clustering, we analyze the relationship between innovative pattern (or type of innovation introduced) and wage for professional category. We found a positive impact of product innovations on wages for all professional groups except unskilled manual workers. Controlling for unobserved firm heterogeneity through a fixed effect panel estimator, coefficients are not significant anymore for all professional categories. Only for innovations in marketing we can still register a wage premium earned by high skilled workers. Finally, we do not register a polarization effect as the one detected for Europe by recent literature. Copyright Eurasia Business and Economic Society 2014

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  • Valeria Cirillo, 2014. "Patterns of innovation and wage distribution. Do “innovative firms” pay higher wages? Evidence from Chile," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 4(2), pages 181-206, December.
    • Handle: RePEc:spr:eurasi:v:4:y:2014:i:2:p:181-206
    DOI: 10.1007/s40821-014-0010-0
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    Cited by:

    1. Rita K. Almeida & Ana M. Fernandes & Mariana Viollaz, 2017. "Does the Adoption of Complex Software Impact Employment Composition and the Skill Content of Occupations? Evidence from Chilean Firms," CEDLAS, Working Papers 0214, CEDLAS, Universidad Nacional de La Plata.
    2. Cirera, Xavier & Martins-Neto, Antonio Soares, 2023. "Do innovative firms pay higher wages? Micro-level evidence from Brazil," Research Policy, Elsevier, vol. 52(1).
    3. Ugur, Mehmet & Mitra, Arup, 2017. "Technology Adoption and Employment in Less Developed Countries: A Mixed-Method Systematic Review," World Development, Elsevier, vol. 96(C), pages 1-18.
    4. Silvia Vannutelli & Sergio Scicchitano & Marco Biagetti, 2022. "Routine-biased technological change and wage inequality: do workers’ perceptions matter?," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(3), pages 409-450, September.
    5. Caterina Santi & Pietro Santoleri, 2017. "Exploring the link between innovation and growth in Chilean firms," Small Business Economics, Springer, vol. 49(2), pages 445-467, August.
    6. Arup Mitra & Chandan Sharma, 2020. "Employment and TFP Impact of Technologies in the Developing World: Domestic versus Imported Expertise," IEG Working Papers 410, Institute of Economic Growth.
    7. Roi D. Taussig, 2017. "Stickiness of employee expenses and implications for stock returns," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 7(2), pages 297-309, August.
    8. Castro Silva, Hugo & Lima, Francisco, 2017. "Technology, employment and skills: A look into job duration," Research Policy, Elsevier, vol. 46(8), pages 1519-1530.
    9. Shampa Paul & Kaushalesh Lal, 2021. "Technology Intensity and Employment in the Indian Economy," Arthaniti: Journal of Economic Theory and Practice, , vol. 20(1), pages 34-52, June.

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    More about this item

    Keywords

    Innovation; Wages; Developing countries; J3; O3; L6; L8;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • L8 - Industrial Organization - - Industry Studies: Services

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