Innovation Persistence and Employment Dynamics

IEB Working Paper N. 2017/03

39 Pages Posted: 21 Feb 2017

See all articles by Stefano Bianchini

Stefano Bianchini

University of Strasbourg

Gabriele Pellegrino

Ecole Polytechnique Fédérale de Lausanne

Date Written: February 15, 2017

Abstract

This paper examines the effect of persistence in product and process innovations on the employment dynamics of a representative sample of Spanish manufacturing firms observed over more than 20 years. We build on a conceptual framework that links innovation persistence, employment growth and the persistence of this growth in the long-run. Using dynamic panel GMM and survival analysis techniques, we find that persistence in product innovation affects both employment growth and the sustainability of job creation over time significantly, whilst persistence in process innovation does not play any relevant role. The evidence we provide supports the notion that product innovation is more effective in spurring sustained employment growth when carried out systematically.

Keywords: firm growth, job creation, innovation, persistence in innovation, path-dependence

JEL Classification: D22, O31, O32, O33

Suggested Citation

Bianchini, Stefano and Pellegrino, Gabriele, Innovation Persistence and Employment Dynamics (February 15, 2017). IEB Working Paper N. 2017/03 . Available at SSRN: https://ssrn.com/abstract=2919290 or http://dx.doi.org/10.2139/ssrn.2919290

Stefano Bianchini

University of Strasbourg ( email )

61, avenue de la foret noire
Strasbourg, Alsace 3000
France

Gabriele Pellegrino (Contact Author)

Ecole Polytechnique Fédérale de Lausanne ( email )

Station 5
Odyssea 1.04
1015 Lausanne, CH-1015
Switzerland

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