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The Employment Effects of Innovation. Evidence from a Sample of Italian Manufacturing Firms

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Abstract

This paper deals with a controversial question: Can innovation create unemployment? Theoretical frameworks and empirical evidences on that topic provide quite different results, depending on the socio-economic and institutional contest where the innovation is introduced and the type of technological change (process vs. product).In our empirical evidence we used a database with information on sales, investments, R&D, product and process innovation and number of employees of about 3000 Italian manufacturing firms. The database covers the period 1992-94. Employment grows in technological advanced industries with respect to traditional industries. The econometric analysis suggests that there are some differences in the behaviour of firms in different regions of Italy. Firms in North East of Italy have better performances than other firms and medium-small firms increased their employment. In particular high R&D expenditures have a negative impact on employment. Big firms spend more in R&D and lose employees in the three years. Investments oriented to increase productive capacity have a positive impact on employment.

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  • Marina Di Giacomo, 2000. "The Employment Effects of Innovation. Evidence from a Sample of Italian Manufacturing Firms," CERIS Working Paper 200009, Institute for Economic Research on Firms and Growth - Moncalieri (TO) ITALY -NOW- Research Institute on Sustainable Economic Growth - Moncalieri (TO) ITALY.
  • Handle: RePEc:csc:cerisp:200009
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    References listed on IDEAS

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    1. Van Reenen, John, 1997. "Employment and Technological Innovation: Evidence from U.K. Manufacturing Firms," Journal of Labor Economics, University of Chicago Press, vol. 15(2), pages 255-284, April.
    2. Brouwer, Erik & Kleinknecht, Alfred & Reijnen, Jeroen O N, 1993. "Employment Growth and Innovation at the Firm Level," Journal of Evolutionary Economics, Springer, vol. 3(2), pages 153-159, May.
    3. Vivarelli, Marco & Evangelista, Rinaldo & Pianta, Mario, 1996. "Innovation and employment in Italian manufacturing industry," Research Policy, Elsevier, vol. 25(7), pages 1013-1026, October.
    4. David Blanchflower & Simon Burgess, 1998. "New Technology And Jobs: Comparative Evidence From A Two Country Study," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 5(2-4), pages 109-138.
    5. Jakob Klette & Svein Erik Førre, 1998. "Innovation And Job Creation In A Smallopen Economy-Evidence From Norwegian Manufacturing Plants 1982-92," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 5(2-4), pages 247-272.
    6. Davies, Stephen & Lyons, Bruce, 1996. "Industrial Organization in the European Union: Structure, Strategy, and the Competitive Mechanism," OUP Catalogue, Oxford University Press, number 9780198289739.
    7. Labini, Paolo Sylos, 1990. "Technical progress, unemployment, and economic dynamics," Structural Change and Economic Dynamics, Elsevier, vol. 1(1), pages 41-55, June.
    8. Marco Vivarelli, 1995. "The Economics of Technology and Employment," Books, Edward Elgar Publishing, number 458, April.
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    More about this item

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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