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The Innovation-Employment nexus: a critical survey of theory and empirics

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  • Flavio Calvino
  • Maria Enrica Virgillito

Abstract

Understanding whether technical change is beneficial or detrimental for employment is at the center of the policy debate, especially in phases of economic recession. So far, the effects of innovation in its manifold declinations and intrinsic complexity on labour demand have proven to be not unequivocal. This essay critically reviews the role of technical change in shaping employment dynamics at different levels of aggregation. Firstly, it disentangles theoretically the role of different compensation mechanisms through which employment adjusts after an innovation is introduced. Secondly, it critically presents the most recent empirical evidence on the topic, with a focus on methods and limitations. Finally, it provides an attempt to conceptualize a number of stylized facts and empirical regularities on the innovation-employment nexus.

Suggested Citation

  • Flavio Calvino & Maria Enrica Virgillito, 2016. "The Innovation-Employment nexus: a critical survey of theory and empirics," LEM Papers Series 2016/10, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  • Handle: RePEc:ssa:lemwps:2016/10
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    Cited by:

    1. Giovanni Dosi & Xiaodan Yu, 2017. "Technological catching-up, sales dynamics and employment growth: evidence from China's manufacturing firms," LEM Papers Series 2017/27, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    2. repec:hig:fsight:v:11:y:2017:i:4:p:9-22 is not listed on IDEAS
    3. Tommaso Ciarli & Alberto Marzucchi & Edgar Salgado & Maria Savona, 2018. "The Effect of R&D Growth on Employment and Self-Employment in Local Labour Markets," SPRU Working Paper Series 2018-08, SPRU - Science and Technology Policy Research, University of Sussex.
    4. Flavio Calvino, 2016. "Technological Innovation and the Distribution of Employment Growth: a firm-level analysis," LEM Papers Series 2016/37, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    5. Laura Barbieri & Mariacristina Piva & Marco Vivarelli, 2016. "The Employment Impact of Different Forms of Innovation: Evidence from Italian Community Innovation Survey," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1620, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    6. Barbieri, Laura & Piva, Mariacristina & Vivarelli, Marco, 2016. "R&D, Embodied Technological Change and Employment: Evidence from Italian Microdata," IZA Discussion Papers 10354, Institute for the Study of Labor (IZA).
    7. Stefano Bianchini & Gabriele Pellegrino, 2017. "Innovation persistence and employment dynamics," Working Papers 2017/03, Institut d'Economia de Barcelona (IEB).

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    Keywords

    Innovation; Technological Unemployment; Compensation Mechanisms;

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