Flexible Labor and Innovation Performance: Evidence from Longitudinal Firm-Level Data

Haibo Zhou, Ronald Dekker and Alfred Kleinknecht

ERIM Report Series Research in Management from Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam

Abstract: Firms with high shares of workers on fixed-term contracts have significantly higher sales of imitative new products but perform significantly worse on sales of inno¬va¬tive new products (“first on the market”). High functional flexibility in “insider-outsider” la¬bor markets enhances a firm’s new product sales, as do training efforts and highly edu¬ca¬¬ted personnel. We find weak evidence that larger and older firms have higher new pro¬duct sales than do younger and smaller firms. Our findings should be food for thought to eco-nomists making unqualified pleas for the deregulation of labor markets.

Keywords: J5; M5; O15; O31; OSA longitudinal dataset; SMEs; innovation performance; new product sales; numerical flexibility (search for similar items in EconPapers)
JEL-codes: M M13 O31 O32 (search for similar items in EconPapers)
Date: 2010-01-21
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Journal Article: Flexible labor and innovation performance: evidence from longitudinal firm-level data (2011)
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