Innovation and Employment: A Survey

22 Pages Posted: 11 Mar 2007

See all articles by Marco Vivarelli

Marco Vivarelli

Universita Cattolica del Sacro Cuore, Milano; IZA Institute of Labor Economics

Date Written: February 2007

Abstract

According to the compensation theory, market forces should assure a complete compensation of the initial labour-saving impact of process innovations. In this paper a critique of this approach is proposed through a detailed survey of the theoretical and empirical literature on the subject. The general conclusion is that - although compensation is always working - the complete counter-balancing of dismissed workers cannot be assumed ex-ante.

Keywords: innovation, technological unemployment, compensation

JEL Classification: J64, O33

Suggested Citation

Vivarelli, Marco, Innovation and Employment: A Survey (February 2007). IZA Discussion Paper No. 2621. Available at SSRN: https://ssrn.com/abstract=969621

Marco Vivarelli (Contact Author)

Universita Cattolica del Sacro Cuore, Milano ( email )

Largo Gemelli 1
Milano, 20123
Italy

IZA Institute of Labor Economics

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

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