Uncertainty, flexible labour relations and R&D expenditure

Marco Di Cintio and Emanuele Grassi

No EC0003, Working Papers from University of Salento; Department of Management, Economics, Mathematics and Statistics

Abstract: This paper examines the effects of uncertainty and flexible labour contracts on the Research and Development (R&D) expenditure. Using a panel of Italian manufacturing firms, we find a hump-shaped relationship between workforce flexibility and R&D outlays. Moreover, as predicted by the real options theory, our results suggest that product market uncertainty reduces R&D efforts and that flexible labour contracts countervail the adverse effect of uncertainty on R&D.

Keywords: real options theory; R&D; uncertainty; temporary workers (search for similar items in EconPapers)
JEL-codes: D22 D81 J41 O31 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2013-12, Revised 2013-12
New Economics Papers: this item is included in nep-com, nep-cse, nep-eur, nep-ino, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Uncertainty, flexible labour relations and R&D expenditure (2013)
Working Paper: Uncertainty, flexible labour relations and R&D expenditure (2012)
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