Employment Effects of Ecological Innovations: An Empirical Analysis
Ecological innovations have increasingly been seen as a major response to environmental problems. An important question for both economic research and public policy is whether these innovations also increase employment or not (the question of a double dividend). The purpose of this paper is to investigate empirically the factors affecting direct employment changes due to eco-innovations at the firm level. This analysis has been conducted in the framework of estimating a labor demand function including eco-innovations, the firm’s output changes (changes in sales), its labor costs changes and a set of control variables (e.g. firm-specific variables, industry and country dummies). Using data from around 1600 firms in five different countries (Germany, Great Britain, Italy, Holland and Switzerland) we have obtained the following empirical results: firms investing in relatively important (from the firm’s perspective) labor cost saving product innovations that have not been subsidized by the state and pursuing a market driven business strategy that leads to increases of their sales in industries in which they have a market power also increase the likelihood of their achieving a positive long term direct employment effect. Firms that deviate - on average - from this ideal portrait do not have positive direct employment effects. (It should, however, be emphasized that neither the indirect microeconomic nor the overall macroeconomic effects of eco-innovations are the subject of this study.)
|Date of creation:||Dec 2000|
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- Brouwer, Erik & Kleinknecht, Alfred & Reijnen, Jeroen O N, 1993. "Employment Growth and Innovation at the Firm Level," Journal of Evolutionary Economics, Springer, vol. 3(2), pages 153-159, May.
- Pfeiffer, Friedhelm, 1997. "Human capital and innovation in East and West German manufacturing firms," ZEW Discussion Papers 97-08, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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- James D Adams, 1997.
"The Structure of Firm R&D and the Factor Intensity of Production,"
97-15, Center for Economic Studies, U.S. Census Bureau.
- James D. Adams, 1997. "The Structure of Firm R&D and the Factor Intensity of Production," NBER Working Papers 6099, National Bureau of Economic Research, Inc.
- Blechinger, Doris & Kleinknecht, Alfred & Licht, Georg & Pfeiffer, Friedhelm, 1998. "The impact of innovation on employment in Europe: An analysis using CIS data," ZEW Dokumentationen 98-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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