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The impact of R&D on employment in Europe: a firm-level analysis

Author

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  • Francesco Bogliacino

    (European Commission, Joint Research Center - Institute for Perspective Technological Studies, Sevilla & Centro de Estudios Para America Latina y el Caribe-Universidad EAFIT, Rise Group)

  • Mariacristina Piva

    (Università Cattolica, Milano and Piacenza)

  • Marco Vivarelli

    (Università Cattolica, Milano and Piacenza & SPRU-University of Sussex & IZA, Bonn)

Abstract

The aim of this paper is to test the employment effect of business R&D expenditures, using a unique longitudinal database covering 677 European manufacturing and service firms over the period 1990-2008. Main result from the whole sample dynamic LSDVC (Least Squared Dummy Variable Corrected) estimate is the labour-friendly nature of companies’ R&D, the coefficient of which turns out to be statistically significant, although not very large in magnitude. However, the positive and significant job creation effect of R&D expenditures is detectable in services and high-tech manufacturing but absent in the more traditional manufacturing sectors. This means that we should not expect positive employment effects from increasing R&D in the majority of industrial sectors. This evidence should be kept in mind by European innovation policy makers having employment as one of their specific aims.

Suggested Citation

  • Francesco Bogliacino & Mariacristina Piva & Marco Vivarelli, 2011. "The impact of R&D on employment in Europe: a firm-level analysis," Working Papers 2011/20, Institut d'Economia de Barcelona (IEB).
  • Handle: RePEc:ieb:wpaper:doc2011-20
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    2. Angela Triguero & David Córcoles & Maria Cuerva, 2014. "Persistence of innovation and firm’s growth: evidence from a panel of SME and large Spanish manufacturing firms," Small Business Economics, Springer, vol. 43(4), pages 787-804, December.

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    More about this item

    Keywords

    Innovation; employment; manufacturing; services; LSDVC;
    All these keywords.

    JEL classification:

    • 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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