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Author: Tom-Reiel Heggedal
Publisher:
ISBN:
Category : Incentives in industry
Languages : en
Pages : 47
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Book Description
Do firms have the right incentives to innovate in the presence of productivity spillovers? This paper proposes an explicit model of spillovers through labor flows in a framework with search frictions. Firms can choose to innovate or to imitate by hiring a worker from a firm that has already innovated. We show that if innovation firms can commit to long-term wage contracts with their workers, productivity spillovers are fully internalized. If firms cannot commit to long-term wage contracts, there is too little innovation and too much imitation in equilibrium. Our model is tractable and allows us to analyze welfare effects of various policies in the limited commitment case. We find that subsidizing innovation and taxing imitation improves welfare. Moreover, allowing innovation firms to charge quit fees or rent out workers to imitation firms also improves welfare. By contrast, non-pecuniary measures like covenants not to compete, interpreted as destruction of matches between imitation firms and workers from innovation firms, always reduce welfare.
Author: Tom-Reiel Heggedal
Publisher:
ISBN:
Category : Incentives in industry
Languages : en
Pages : 47
Get Book Here
Book Description
Do firms have the right incentives to innovate in the presence of productivity spillovers? This paper proposes an explicit model of spillovers through labor flows in a framework with search frictions. Firms can choose to innovate or to imitate by hiring a worker from a firm that has already innovated. We show that if innovation firms can commit to long-term wage contracts with their workers, productivity spillovers are fully internalized. If firms cannot commit to long-term wage contracts, there is too little innovation and too much imitation in equilibrium. Our model is tractable and allows us to analyze welfare effects of various policies in the limited commitment case. We find that subsidizing innovation and taxing imitation improves welfare. Moreover, allowing innovation firms to charge quit fees or rent out workers to imitation firms also improves welfare. By contrast, non-pecuniary measures like covenants not to compete, interpreted as destruction of matches between imitation firms and workers from innovation firms, always reduce welfare.
Author: Tom-Reiel Heggedal
Publisher:
ISBN:
Category :
Languages : en
Pages : 60
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Book Description
This paper proposes an explicit model of spillovers through labor flows in a framework with search frictions. Firms can choose to innovate or to imitate by hiring a worker from a firm that has already innovated. We show that if innovating firms can commit to long-term wage contracts with their workers, productivity spillovers are fully internalized. If firms cannot commit to long-term wage contracts, there is too little innovation and too much imitation in equilibrium. Our model is tractable and allows us to analyze welfare effects of various policies in the limited commitment case. We find that subsidizing innovation and taxing imitation improves welfare. Moreover, allowing innovating firms to charge quit fees or rent out workers to imitating firms also improves welfare. By contrast, non-pecuniary measures like restrictions on mobility, interpreted as reducing matching efficiency between imitating firms and workers from innovating firms, always reduce welfare.
Author: Holger Görg
Publisher:
ISBN:
Category : Corporations, Foreign
Languages : en
Pages : 32
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Book Description
Author: Ayanda Hlatshwayo
Publisher:
ISBN: 9789292567507
Category :
Languages : en
Pages :
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Book Description
This paper uses matched employer-employee data from South Africa to examine the extent to which technology transfers between firms through the hiring of workers. Allowing for differential spillovers based on observable technology differences between sending and receiving firms, we find strong evidence for positive productivity spillovers through worker mobility. In contrast to previous studies set in more advanced economies, our results suggest that negative spillovers can occur. Firms that hire workers from less productive firms experience a decline in productivity in the following year compared with similar firms that do not hire any workers. This, we suggest, may be explained by the high skills deficit in the South African labour market, and an important mechanism for technology transfers in the future may be driven by investments in firm-level training initiatives.
Author: Dirk Fornahl
Publisher: Springer Science & Business Media
ISBN: 0387231404
Category : Business & Economics
Languages : en
Pages : 225
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Book Description
The purpose of this volume is to analyze the microfoundations of knowledge spillovers. The microeconomic analysis of spillovers leads to the insight that the spillover and flow of knowledge is not at all automatic. Instead, this volume suggests that a filter exists between knowledge and its economic application. The focus of this volume is on several key mechanisms that serve to reduce this filter and facilitate the flow of knowledge. In particular, the volume draws on an emerging literature identifying the role of knowledge spillovers to investigate significance of labor mobility and informal networks as mechanisms facilitating the flow of knowledge. No field in economics has dealt extensively with the microeconomics of knowledge spillovers. This volume brings together scholars from a broad spectrum of fields including labor economics, regional economics, the economics of innovation and technological change, and sociology to introduce new insights yielded from the microfoundations of knowledge spillovers.
Author: Andrey Stoyanov
Publisher:
ISBN:
Category :
Languages : en
Pages : 54
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Book Description
We estimate how much of the gains from productivity spillovers through worker mobility is retained by the hiring firms, by the workers who bring spillovers, and by the other workers. Using linked employer-employee data from Danish manufacturing for the period 1995-2007, we find that at least two-thirds of the total output gain of 0.11% per year is netted by the firms, while the workers who bring spillovers receive at most 6% of it as the wage premium. The large share retained by the firms implies that spillovers through worker mobility are mostly a positive externality to them.
Author: Marzieh Abolhassani
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Roope Ohlsbom
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
Using linked employer-employee data from Finland, we examine the mobility of workers between establishments as a source of productivity-affecting knowledge spillovers. We find evidence that hiring workers from more productive establishments leads to higher productivity in the following year. For an average establishment, this productivity increase amounts to 0.45 percent in our most conservative estimate. The observed productivity gains hold for a variety of specifications, and changes in the receiving establishments' human capital stock are ruled out as an explanation.
Author: Marzieh Abolhassani
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Michel Serafinelli
Publisher:
ISBN:
Category :
Languages : en
Pages : 85
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Book Description
A prominent feature of the economic landscape in the most developed countries is the tendency for firms to locate near other firms producing similar products or services. In the United States, for example, biopharmaceutical firms are clustered in New York and Chicago and a sizeable share of the elevator and escalator industry is concentrated in the area around Bloomington, Indiana. In addition, the growth and diffusion of multinational corporations has led to the recent appearance of important industrial clusters in several emerging economies. Firms that originally agglomerated in Silicon Valley and Detroit now have subsidiaries clustered in Bangalore and Slovakia. Researchers have long speculated that firms in industrial concentrations may benefit from agglomeration economies, and a growing body of work has been devoted to studying the importance of these economies. Despite the difficulties involved in estimating agglomeration effects, a consensus has emerged from the literature that significant productivity advantages of agglomeration exist for many industries (Rosenthal and Strange, 2003; Henderson, 2003; Ellison, Glaeser and Kerr, 2010; Greenstone, Hornbeck and Moretti, 2010; Combes et al., 2012). Localized knowledge spillovers are a common explanation for the productivity advantages of agglomeration. Nevertheless, as pointed out by Combes and Duranton (2102) if information can easily flow out of firms, the question of why the effects of spillovers are localized must be clarified. This dissertation directly examines the role of labor mobility as a mechanism for the transfer of efficiency-enhancing knowledge and evaluates the extent to which labor mobility can explain the productivity advantages of firms located near other highly productive firms. The underlying idea is that knowledge is embedded in workers and diffuses when workers move between firms. The strong localized aspect of knowledge spillovers discussed in the agglomeration literature may thus arise from the propensity of workers to change jobs within the same local labor market. In order to empirically assess the importance of labor-market based knowledge spillovers, I use matched employer-employee data from the centre and north-east of Italy (mainly Veneto, but also Emilia Romagna and Tuscany). While the issues analyzed in this study are of general interest, the case of this region is important because it is an economic area where networks of specialized small and medium-sized firms, frequently organized in districts, have been effective in promoting and adapting to technological change during the last three decades. This so called "Third Italy" region has received a good deal of attention by researchers, in the United States as well as in Europe. In chapter 1, titled "Labor Mobility as a Mechanism for Knowledge Transfer", I present direct evidence on the role of firm-to-firm labor mobility in enhancing the productivity of firms located near highly productive firms. More specifically, I identify a set of high-wage firms (HWF) and show they are more productive than other firms. I then show that hiring a worker with HWF experience increases the productivity of other (non-HWF) firms. In chapter 2, titled "Worker flows and Agglomeration Advantages", I relate the findings In Chapter 1 to the existing evidence on the productivity advantages of agglomeration. Simulation results indicate that worker flows explain 10-15 percent of the productivity gains experienced by other firms when HWFs in the same industry are added to a local labor market. In chapter 3, titled "Mobility of Inventors and Innovation", my co-author Sabrina Di Addario and I investigate the relationship between worker flows and innovative activity. We use a unique dataset that matches administrative employer-employee records to patent data and focus on labor market mobility of inventors. While inventors are not the only workers that may transfer relevant information from one firm to another, they undoubtedly have a large potential to do so. Our preliminary results show that the number of workers who have applied for a patent while working at a previous firm is positively and statistically significantly related to patenting activity of the current firm's other employees.
