IDEAS home Printed from https://ideas.repec.org/p/kgu/wpaper/146.html
   My bibliography  Save this paper

Numerical labor flexibility and innovation outcomes of start-up firms: A panel data analysis

Author

Listed:
  • Masatoshi Kato

    (School of Economics, Kwansei Gakuin University)

  • Haibo Zhou

    (Faculty of Economics and Business, University of Groningen)

Abstract

Using a panel data set based on repeated questionnaire surveys in Japan, this study examines the effects of numerical labor flexibility on innovation outcomes of start-up firms, a topic that has not been well examined in the literature. Using a random-effects probit model, the estimation results indicate that the use of temporary employees significantly increases the probability of product innovation. In addition, numerical flexibility, measured as external labor turnover of regular employees, initially increases and then decreases the probability of patent application. The implications of our findings are discussed.

Suggested Citation

  • Masatoshi Kato & Haibo Zhou, 2016. "Numerical labor flexibility and innovation outcomes of start-up firms: A panel data analysis," Discussion Paper Series 146, School of Economics, Kwansei Gakuin University, revised Aug 2016.
  • Handle: RePEc:kgu:wpaper:146
    as

    Download full text from publisher

    File URL: http://192.218.163.163/RePEc/pdf/kgdp146.pdf
    File Function: First version, 2016
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Haibo Zhou & Ronald Dekker & Alfred Kleinknecht, 2011. "Flexible labor and innovation performance: evidence from longitudinal firm-level data," Industrial and Corporate Change, Oxford University Press, vol. 20(3), pages 941-968, June.
    2. Lorenz, Edward, 1999. "Trust, Contract and Economic Cooperation," Cambridge Journal of Economics, Oxford University Press, vol. 23(3), pages 301-315, May.
    3. Annika Rickne & Staffan Jacobsson, 1999. "New Technology-Based Firms In Sweden - A Study Of Their Direct Impact On Industrial Renewal," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 8(3), pages 197-223.
    4. Honjo, Yuji, 2015. "Why are entrepreneurship levels so low in Japan?," Japan and the World Economy, Elsevier, vol. 36(C), pages 88-101.
    5. Cécile Ayerbe & Nathalie Lazaric & Michel Callois & Liliana Mitkova, 2014. "The new challenges of organizing intellectual property in complex industries: A discussion based on the case of Thales," Post-Print halshs-01061538, HAL.
    6. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, March.
    7. Spyros Arvanitis, 2005. "Modes of labor flexibility at firm level: Are there any implications for performance and innovation? Evidence for the Swiss economy," Industrial and Corporate Change, Oxford University Press, vol. 14(6), pages 993-1016, December.
    8. Romijn, Henny & Albaladejo, Manuel, 2002. "Determinants of innovation capability in small electronics and software firms in southeast England," Research Policy, Elsevier, vol. 31(7), pages 1053-1067, September.
    9. Andrea Bassanini & Ekkehard Ernst, 2002. "Labour Market Institutions, Product Market Regulation, and Innovation: Cross-Country Evidence," OECD Economics Department Working Papers 316, OECD Publishing.
    10. Jonathan Michie & Maura Sheehan, 2003. "Labour market deregulation, 'flexibility' and innovation," Cambridge Journal of Economics, Oxford University Press, vol. 27(1), pages 123-143, January.
    11. Alfred Kleinknecht & Remco Oostendorp & Menno Pradhan & C. W. M. Naastepad, 2006. "Flexible Labour, Firm Performance and the Dutch Job Creation Miracle," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(2), pages 171-187.
    12. Marcati, Alberto & Guido, Gianluigi & Peluso, Alessandro M., 2008. "The role of SME entrepreneurs' innovativeness and personality in the adoption of innovations," Research Policy, Elsevier, vol. 37(9), pages 1579-1590, October.
    13. Amaia Altuzarra & Felipe Serrano, 2010. "Firms' Innovation Activity and Numerical Flexibility," ILR Review, Cornell University, ILR School, vol. 63(2), pages 327-339, January.
    14. Baron, Robert A. & Tang, Jintong, 2011. "The role of entrepreneurs in firm-level innovation: Joint effects of positive affect, creativity, and environmental dynamism," Journal of Business Venturing, Elsevier, vol. 26(1), pages 49-60, January.
    15. Michele Belot & Jan Boone & Jan Van Ours, 2007. "Welfare-Improving Employment Protection," Economica, London School of Economics and Political Science, vol. 74(295), pages 381-396, August.
    16. Acs, Zoltan J & Audretsch, David B, 1987. "Innovation, Market Structure, and Firm Size," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 567-574, November.
    17. Giuseppe Nicoletti & Stefano Scarpetta, 2003. "Regulation, productivity and growth: OECD evidence," Economic Policy, CEPR;CES;MSH, vol. 18(36), pages 9-72, April.
    18. James M. Malcomson, 1997. "Contracts, Hold-Up, and Labor Markets," Journal of Economic Literature, American Economic Association, vol. 35(4), pages 1916-1957, December.
    19. Alfred Kleinknecht & Flore N. van Schaik & Haibo Zhou, 2014. "Is flexible labour good for innovation? Evidence from firm-level data," Cambridge Journal of Economics, Oxford University Press, vol. 38(5), pages 1207-1219.
    20. Masatoshi Kato & Hiroyuki Okamuro & Yuji Honjo, 2011. "Does founders’ human capital matter for innovation? Evidence from Japanese start-ups," Discussion Paper Series 78, School of Economics, Kwansei Gakuin University, revised Dec 2011.
    21. Viral V. Acharya & Ramin P. Baghai & Krishnamurthy V. Subramanian, 2013. "Labor Laws and Innovation," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 997-1037.
    22. Wachsen, Eva & Blind, Knut, 2016. "More labour market flexibility for more innovation? Evidence from employer–employee linked micro data," Research Policy, Elsevier, vol. 45(5), pages 941-950.
    23. Malerba, Franco & Orsenigo, Luigi, 1995. "Schumpeterian Patterns of Innovation," Cambridge Journal of Economics, Oxford University Press, vol. 19(1), pages 47-65, February.
    24. Yuji Honjo & Masatoshi Kato & Hiroyuki Okamuro, 2014. "R&D investment of start-up firms: does founders’ human capital matter?," Small Business Economics, Springer, vol. 42(2), pages 207-220, February.
    25. Chang, Shann-Bin, 2012. "Using patent analysis to establish technological position: Two different strategic approaches," Technological Forecasting and Social Change, Elsevier, vol. 79(1), pages 3-15.
    26. Okamuro, Hiroyuki, 2007. "Determinants of successful R&D cooperation in Japanese small businesses: The impact of organizational and contractual characteristics," Research Policy, Elsevier, vol. 36(10), pages 1529-1544, December.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    start-up firm; numerical flexibility; regular employee flexibility; nonregular employee flexibility; innovation outcome; panel data;

    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kgu:wpaper:146. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Toshihiro Okada). General contact details of provider: http://edirc.repec.org/data/dekgujp.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.