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Innovation and Employment: Evidence from Italian Microdata

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  • Piva, Mariacristina

    (Università Cattolica del Sacro Cuore)

  • Vivarelli, Marco

    (Università Cattolica del Sacro Cuore)

Abstract

The microeconomic empirical literature devoted to the link between innovation and employment tends to suggest that technological change has a positive effect on jobs, at least at the level of the firm. The main purpose of this paper is to see whether this result still holds in a situation where intermediate technologies are implemented mainly through gross innovative investments, as in Italian manufacturing. Applying GMM-SYS to an employment equation augmented for technology and using a unique longitudinal dataset of 575 Italian manufacturing firms over the period 1992-1997, this paper finds a significant - although small in size - positive relationship between innovation and employment. While the links with sales and wages have the expected signs and turn out to be significant, the job creating impact of innovation proves robust after checking for time, industry, firm's size and geographical fixed effects.

Suggested Citation

  • Piva, Mariacristina & Vivarelli, Marco, 2003. "Innovation and Employment: Evidence from Italian Microdata," IZA Discussion Papers 730, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp730
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    References listed on IDEAS

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    3. Werner Smolny, 1998. "Innovations, Prices and Employment: A Theoretical Model and an Empirical Application for West German Manufacturing Firms," Journal of Industrial Economics, Wiley Blackwell, vol. 46(3), pages 359-381, September.
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    10. Marco Vivarelli, 1995. "The Economics of Technology and Employment," Books, Edward Elgar Publishing, number 458.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Italian manufacturing; employment; technology; GMM-SYS;
    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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