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Employers’ Agglomeration and Innovation in a Small Business Economy: The Italian Case

In: Geographical Labor Market Imbalances. Recent Explanations and Cures

Author

Listed:
  • Giuseppe Croce

    (Università di Roma "La Sapienza")

  • Edoardo Di Porto

    (Università di Napoli "Federico II")

  • Emanuela Ghignoni

    (Università di Roma "La Sapienza")

  • Andrea Ricci

    (ISFOL)

Abstract

This chapter analyzes the impact of agglomeration on product and process innovation in Italy. Our main goal is to gain a better understanding of the spatial dimension of innovative activities. Based on a unique firm-level source of data provided by ISFOL containing information on employers’ personal profiles, we attempt to shed more light into the black box of the local knowledge spillovers. To this end, besides standard density measures, we define and employ an original density indicator and perform a series of IV regressions. Different from the main strands of the literature on this topic, which envisages positive knowledge spillover effects stemming from agglomeration, we do not find significant evidence that agglomeration fosters innovation. In particular, when small businesses are considered, a negative and significant effect arises. Such evidence suggests that in denser areas detrimental congestion effects tend to prevail and discourage innovation. Moreover, for this subsample of firms, the employers’ personal profile prove to be a relevant boost for innovation.

Suggested Citation

  • Giuseppe Croce & Edoardo Di Porto & Emanuela Ghignoni & Andrea Ricci, 2015. "Employers’ Agglomeration and Innovation in a Small Business Economy: The Italian Case," AIEL Series in Labour Economics, in: Chiara Mussida & Francesco Pastore (ed.), Geographical Labor Market Imbalances. Recent Explanations and Cures, edition 1, chapter 8, pages 167-192, AIEL - Associazione Italiana Economisti del Lavoro.
  • Handle: RePEc:ail:chapts:08-08
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    File URL: http://link.springer.com/chapter/10.1007/978-3-642-55203-8_8
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    Cited by:

    1. Marina Capparucci & Alina Verashchagina, 2016. "I divari territoriali nell?innovazione delle imprese italiane," QUADERNI DI ECONOMIA DEL LAVORO, FrancoAngeli Editore, vol. 2016(105), pages 81-114.

    More about this item

    Keywords

    Product and process innovation; Agglomeration; Knowledge spillovers; Poaching; Employer’s education;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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