 Population ageing, labour market rigidity and corporate innovation: Evidence from ChinaYouchao Tan, Xiumei Liu, Hanwen Sun and Zeng, Cheng(Colin) Research Policy, 2022, vol. 51, issue 2 Abstract: Population ageing leads to labour scarcity and labour market rigidity. Contrary to supply-side economists’ belief that labour market rigidity tends to suppress firm innovation, we provide novel evidence of a positive relationship between population ageing and firm innovation in China. This enhancement effect is greater for firms with higher labour costs, consistent with the argument that labour scarcity encourages labour-saving innovation in response to demographic shifts. In addition, the observed positive effect is particularly pronounced for state-owned enterprises, which are widely acknowledged to be overstaffed with older workers, and firms in industries that pursue Schumpeter-II innovation and engage in more intense research and development. In addition, population ageing helps firms to generate more exploitative (vs. exploratory) innovation. Overall, our findings suggest that firms facing population ageing can adapt their strategies to innovate successfully. Keywords: Population ageing; Labour scarcity; Labour market rigidity; Innovation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:51:y:2022:i:2:s0048733321002213 DOI: 10.1016/j.respol.2021.104428 Access Statistics for this article Research Policy is currently edited by M. Bell, B. Martin, W.E. Steinmueller, A. Arora, M. Callon, M. Kenney, S. Kuhlmann, Keun Lee and F. Murray More articles in Research Policy from Elsevier |
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