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Employment Growth in Europe: The Roles of Innovation, Local Job Multipliers and Institutions

24 Pages Posted: 10 Oct 2015  

Maarten Goos

KU Leuven - Faculty of Business and Economics (FEB)

Jozef Konings

Catholic University of Leuven (KUL) - LICOS - Centrum voor Transitie-economie; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Marieke Vandeweyer

KU Leuven. Faculty of Business and Economics (FBE)

Date Written: October 1, 2015

Abstract

This paper shows that high-tech employment - broadly defined as all workers in high-tech sectors but also workers with STEM degrees in low-tech sectors - has increased in Europe over the past decade. Moreover, we estimate that every high-tech job in a region creates five additional low-tech jobs in that region because of the existence of a local high-tech job multiplier. The paper also shows how the presence of a local high-tech job multiplier results in convergence between Europe's regions. That is, employment in Europe's lagging regions is becoming more similar to Europe's high-tech hubs. However, our estimates suggest that this convergence is happening at a glacial pace, and some suggestive evidence is presented that lifting several institutional barriers to innovation in Europe's lagging regions would speed up convergence leading to faster high-tech as well as overall employment while also addressing Europe's regional inequalities.

Suggested Citation

Goos, Maarten and Konings, Jozef and Vandeweyer, Marieke, Employment Growth in Europe: The Roles of Innovation, Local Job Multipliers and Institutions (October 1, 2015). Available at SSRN: https://ssrn.com/abstract=2671765 or http://dx.doi.org/10.2139/ssrn.2671765

Maarten Goos (Contact Author)

KU Leuven - Faculty of Business and Economics (FEB) ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

HOME PAGE: http://www.econ.kuleuven.be/maarten.goos

Jozef Konings

Centre for Economic Policy Research (CEPR)

77 Bastwick Street
London, EC1V 3PZ
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Catholic University of Leuven (KUL) - LICOS - Centrum voor Transitie-economie ( email )

Waaistraat 6 - box 3511
Leuven, 3000
Belgium
+32 16 326 589 (Phone)
+32 16 326 599 (Fax)

Marieke Vandeweyer

KU Leuven. Faculty of Business and Economics (FBE) ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

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