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Innovation persistence and employment dynamics

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  • Stefano Bianchini

    (BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique)

  • Gabriele Pellegrino

    (EPFL - Ecole Polytechnique Fédérale de Lausanne)

Abstract

This paper examines the effect of persistence in product and process innovations on the employment dynamics of a representative sample of Spanish manufacturing firms observed over more than 20 years. We build a conceptual framework that links innovation, its persistence, and different trajectories of employment growth. This framework suggests that firms might show different responses in terms of their employment growth and its persistence depending on the degree of persistence in their product and process innovations. We construct a synthetic indicator of innovation persistence at the firm-level and link this indicator to different employment trajectories. We find that persistence in product innovation affects both employment growth and the sustainability of job creation over time significantly, whilst persistence in process innovation does not play any relevant role. Also, the positive effect of persistence in product innovation is particularly strong for SMEs. The evidence we provide supports the notion that product innovation is more effective in spurring sustained employment growth when carried out systematically.

Suggested Citation

  • Stefano Bianchini & Gabriele Pellegrino, 2019. "Innovation persistence and employment dynamics," Post-Print hal-02312454, HAL.
    • Handle: RePEc:hal:journl:hal-02312454
    DOI: 10.1016/j.respol.2018.12.008
    Note: View the original document on HAL open archive server: https://hal.univ-lorraine.fr/hal-02312454
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    More about this item

    Keywords

    Firm growth; Job creation; Persistence in innovation; Innovation spell; Path-dependence;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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