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Wage Fairness, Growth and the Utilization of R&D Workers

  • Lundborg, Per

    (Trade Union Institute for Economic Research)

In 1999, only one of three US scientists and engineers was employed to do R&D and, in several countries over the last forty to fifty years, employment of skilled workers for R&D purposes appears not to have kept pace with the overall increase in the supply of skilled workers. Low utilization of R&D personnel implies low growth per human capital endowments. To analyze the low R&D utilization/low growth equilibria, we set up an endogenous growth model in which firms set fair wages and which allows for an analysis of changes in the utilization rate of R&D workers. We find that the rise in under utilization and the fall in growth per human capital to be consistent with the increase in the demand for higher education. This could be interpreted as the “consumption” element in higher education has received an increased importance yielding a low growth effect of higher education. The results also point at problems of correctly measuring actual human capital inputs in firms.

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Paper provided by Trade Union Institute for Economic Research in its series Working Paper Series with number 206.

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Length: 22 pages
Date of creation: 19 Sep 2005
Date of revision:
Handle: RePEc:hhs:fiefwp:0206
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  1. Arai, Mahmood & Heyman, Fredrik, 2004. "Microdata Evidence on Rent-Sharing," Working Paper Series 198, Trade Union Institute for Economic Research.
  2. Lundborg, Per & Sacklén, Hans, 2003. "Low-Inflation Targeting and Unemployment Persistence," Working Paper Series 188, Trade Union Institute for Economic Research.
  3. Anna Larsson, 2004. "The Swedish real exchange rate under different currency regimes," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 140(4), pages 706-727, December.
  4. Pekkarinen, Tuomas & Vartiainen, Juhana, 2002. "Gender Differences in Job Assignment and Promotion in a Complexity Ladder of Jobs," Working Paper Series 184, Trade Union Institute for Economic Research.
  5. Heyman, Fredrik, 2004. "The Employer Age-Wage Effect: Evidence from Matched Employer-Employee Data," Working Paper Series 193, Trade Union Institute for Economic Research.
  6. Poldahl, Andreas & Gustavsson Tingvall, Patrik, 2005. "Is There Really an Inverted U-shaped Relation Between Competition and R&D?," Working Paper Series 204, Trade Union Institute for Economic Research.
  7. Clas Eriksson & Joakim Persson, 2003. "Economic Growth, Inequality, Democratization, and the Environment," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 25(1), pages 1-16, May.
  8. Lundborg, Per & Rechea, Calin, 2002. "Will Transition Countries Benefit or Lose from the Brain Drain?," Working Paper Series 187, Trade Union Institute for Economic Research.
  9. Fredrik Heyman, 2005. "Pay inequality and firm performance: evidence from matched employer-employee data," Applied Economics, Taylor & Francis Journals, vol. 37(11), pages 1313-1327.
  10. Larsson, Anna & Zetterberg, Johnny, 2003. "Does Inflation Targeting Matter for Labour Markets? – Some Empirical Evidence," Working Paper Series 191, Trade Union Institute for Economic Research.
  11. Antelius, Jesper & Zetterberg, Johnny, 2004. "Intelligens och personlighetsdrag som förklaring till inkomst(löne-)skillnader mellan individer," Working Paper Series 202, Trade Union Institute for Economic Research.
  12. Alexius, Annika & Carlsson, Mikael, 2001. "Measures of Technology and the Business Cycle: Evidence from Sweden and the U.S," Working Paper Series 174, Trade Union Institute for Economic Research.
  13. Lundin, Nan Nan & Yun, Lihong, 2004. "International Trade and Inter-Industry Wage Structure in Swedish Manufacturing - Evidence from matched employer-employee data," Working Paper Series 196, Trade Union Institute for Economic Research.
  14. Annika Alexius & Mikael Carlsson, 2005. "Measures of Technology and the Business Cycle," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 299-307, May.
  15. Bandick, Roger, 2004. "Do Workers Benefit from Foreign Ownership? Evidence from Swedish Manufacturing," Working Papers 2004:15, Örebro University, School of Business.
  16. Alexius, Annika, 2001. "How to Beat the Random Walk," Working Paper Series 175, Trade Union Institute for Economic Research.
  17. Skogman Thoursie, Peter, 2005. "Happy Birthday! You are Insured - Differences in Work Ethics Between Female and Male Workers," Working Paper Series 203, Trade Union Institute for Economic Research.
  18. Nekby, Lena, 2002. "Employment Convergence of Immigrants and Natives in Sweden," Research Papers in Economics 2002:9, Stockholm University, Department of Economics.
  19. Lundborg, Per, 2005. "Individual Wage Setting, Efficiency Wages and Productivity in Sweden," Working Paper Series 205, Trade Union Institute for Economic Research.
  20. Lundborg, Per & Sacklén, Hans, 2001. "Is There a Long Run Unemployment-Inflation Trade-off in Sweden?," Working Paper Series 173, Trade Union Institute for Economic Research.
  21. Heyman, Fredrik, 2002. "Wage Dispersion and Job Turnover: Evidence from Sweden," Working Paper Series 181, Trade Union Institute for Economic Research.
  22. Karpaty, Patrik & Lundberg, Lars, 2004. "Foreign Direct Investment and Productivity spillovers in Swedish Manufacturing," Working Papers 2004:2, Örebro University, School of Business.
  23. Arai, Mahmood & Heyman, Fredrik, 2001. "Wages, Profits and Individual Unemployment Risk : Evidence from Matched Worker-Firm Data," Working Paper Series 172, Trade Union Institute for Economic Research.
  24. Arai, Mahmood & Skogman Thoursie, Peter, 2001. "Incentives and Selection in Cyclical Absenteeism," Working Paper Series 167, Trade Union Institute for Economic Research.
  25. Arai, Mahmood & Vilhelmsson, Roger, 2001. "Immigrants' and Natives' Unemployment-risk: Productivity Differentials or Discrimination?," Working Paper Series 169, Trade Union Institute for Economic Research.
  26. Nekby, Lena, 2002. "Gender Differences in Rent Sharing and its Implications for the Gender Wage Gap," Working Paper Series 182, Trade Union Institute for Economic Research.
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