The Nexus between Labor Diversity and Firm Innovation

Pierpaolo Parrotta, Dario Pozzoli and Mariola Pytlikova

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Abstract: In this paper, we investigate the nexus between firm labor diversity and innovation by using data on patent applications filed by firms at the European Patent Office and a linked employer–employee database from Denmark. Exploiting the information retrieved from these comprehensive data sets and implementing proper instrumental variable strategies, we estimate the contribution of workers' diversity in cultural background, education and demographic characteristics to valuable firm's innovation activity. Specifically, we find evidence supporting the hypothesis that ethnic diversity may facilitate firms' patenting activity in several ways by (a) increasing the propensity to (apply for a) patent, (b) increasing the overall number of patent applications, and (c) by enlarging the breadth of patenting technological fields, conditional on patenting. Several robustness checks corroborate the main findings.

Keywords: extensive and intensive margins; Labor diversity; ethnic diversity; patenting activity (search for similar items in EconPapers)
Date: 2014
Note: View the original document on HAL open archive server: https://hal.science/hal-01513968
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Citations: View citations in EconPapers (61)

Published in Journal of Population Economics, 2014, 27(2), pp.303-364. ⟨10.1007/s00148-013-0491-7⟩

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Related works:
Journal Article: The nexus between labor diversity and firm’s innovation (2014)
Working Paper: The Nexus between Labor Diversity and Firm's Innovation (2012)
Working Paper: The Nexus between Labor Diversity and Firm's Innovation (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01513968

DOI: 10.1007/s00148-013-0491-7

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