Innovation and Employment: A firm level analysis with European R&D Scoreboard data

Francesco Bogliacino

No 2010-08, JRC Working Papers on Corporate R&D and Innovation from Joint Research Centre

Abstract: In this article, we analyse the microeconomic relationship between innovation and employment, using company data from R&D Scoreboard for Europe covering 2000-2008. We estimate a reduced form equation in which R&D can account for both product and process innovation. The existence of non constant elasticities is assessed, due to the combination of efficient scale and decreasing return to R&D: in our empirical estimates the scale effect tends to prevail for a given R&D intensity generating an increasing relationship between total turnover and employment. Our results have important implications for policymakers: R&D and innovation supporting policies should be correctly tailored and monitored since the results depend on the characteristics of the firms benefited. By the same token, calibration of general equilibrium models aimed at quantifying the employment impact of R&D and innovation policies should take into account that the average elasticity can be a very rough approximation. We claim that our results support the position that R&D and innovation policies should be tailored towards favouring entry by knowledge intensive firms, instead of supporting existing actors.

Keywords: Technological change; corporate R&D; employment; panel data (search for similar items in EconPapers)
JEL-codes: J20 O33 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2010-09
New Economics Papers: this item is included in 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 (10)

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Journal Article: Innovation and employment: A firm level analysis with European R&D Scoreboard data (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:ipt:wpaper:201008

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