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After discussing theory regarding the consequences of technological change on employment, our aim is to test the possible job creation effect of business R&D expenditures, using a unique longitudinal database covering 677 European firms (1990-2008). The main outcome from the dynamic LSDVC (Least Squared Dummy Variable Corrected) estimate is the labour-friendly nature of companies’ R&D, the coefficient of which turns out to be statistically significant. However, the positive impact of R&D on employment is only detectable in services and high-tech manufacturing. This is something that should be borne in mind by European policy makers having employment as one of their aims.

This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external RD however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while − in contrast with the incumbent firms − in-house R&D does not play a significant role.

This chapter focuses on the relationship between firms’ technological competencies and capabilities and different forms of cooperation for innovation by combining the analysis of both micro and meso levels, i.e. the level of the firm and of the geographical region. Our findings, based on the Fourth UK Community Innovation Survey (CIS), provide new insights regarding the relationship between cooperative linkages for innovation and firms’ technological status. Firstly, the distinction between competencies and capabilities adopted in this chapter seems appropriate for going beyond the rather simplistic dichotomy of ‘innovative’ versus ‘non-innovative’ firms commonly used in interpreting CIS data. Secondly, we find that the analysis for the UK as a whole masks stark regional differences in terms of intra- and extra-region collaborative linkages and firms’ technological status.

This paper investigates, both theoretically and empirically, the implications that complementary assets needed for the formation of start-ups – proxied by the ease of access to financial resources – have on the innovative efforts of incumbent firms. In particular, we develop a theoretical model, highlighting a strategic incentive effect by which the innovative efforts of incumbent firms are decreasing in the availability of the complementary assets needed for the creation of a start- up. The empirical relevance of this effect is investigated by using firm level data drawn from the third Italian Community Innovation Survey covering the period 1998-2000. The results of our empirical analysis support our theory-based insights.

The job creation effect of business R&D is tested applying the dynamic LSDVC estimator to a longitudinal database covering 677 European companies over the period 1990–2008. Job creation is detected in services and high-tech manufacturing, but not in traditional sectors.

This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external R&D and at the acquisition of external technology in its embodied and disembodied components. These ‘innovative’ input-output relationships are tested on a sample of 2,713 innovative Italian firms. A sample-selection approach is applied to study both the determinants of product innovation and the factors affecting the intensity of innovation. Results show that in-house R&D is linked to the propensity to introduce product innovation both in mature firms and YICs; however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while in-house R&D does not play a significant role.

How is the R&D-productivity link affected by the environment where firms locate? Are companies located with their registered offices in more R&D favorable environments better able to translate their R&D knowledge into productivity gains? Our paper tries to answer these questions analyzing - in the European context - if R&D performing companies cluster themselves in “higher-order R&D regions”, as the Economic Geography theories postulate, inducing a polarisation in terms of labour productivity in comparison with firms located in “lower-order R&D regions”. The proposed microeconometric estimates are based on a unique longitudinal database of publicly-traded companies belonging to manufacturing and service sectors. The final unbalanced sample comprises 626 European companies for a total of 3,431observations, covering the period 1990-2008. Results show that European “higher-order R&D regions” not only invest more in R&D, but also achieve more in terms of productivity gains from their own research activities. Results also show that in the case of “lower-order R&D regions”, physical capital stock is still playing a dominant role.

In this paper we assess the job creation effect of R&D expenditures, using a unique longitudinal database of 677 European companies over the period 1990-2008. We estimate a dynamic labour demand specification using a Least Squares Dummy Variable Corrected (LSDVC) technique. The labour-friendly nature of R&D emerges from the empirical analysis on the overall sample. However, this positive significant effect corresponds to the high-tech sector and services, while the effect is not significant for traditional manufacturing. The results support the policy agenda of promoting structural change in European economies.

This paper focuses on the relationship between firms’ technological capabilities and different forms of cooperation for innovation by combining the analysis of both micro and meso levels, i.e. the level of the firm and of the geographical region. Our findings, based on the Fourth UK Community Innovation Survey (CIS), provide new insights regarding the relationship between cooperative linkages for innovation and the development of technological capabilities by business units. Firstly, the distinction between competences and capabilities adopted in this paper seems appropriate for going beyond the rather simplistic dichotomy of ‘innovative’ versus ‘non-innovative’ firms commonly used in interpreting CIS data. Secondly, we find that the analysis for the UK as a whole masks stark regional differences in terms of intra- and extra-region collaborative linkages and degrees of firms’ technological capabilities. These findings may be useful to help policy making to meet the priorities highlighted within the UK Government’s framework for Science & Technology.

Using a panel of 211 Italian manufacturing firms for 1995–2001 and the Least Squares Dummy Variable Corrected (LSDVC) estimator recently discussed in the econometric literature, it is shown that demand-pull innovation is particularly significant in liquidity-constrained companies in both the short run and long run.

This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external R&D and at the acquisition of external technology in embodied and disembodied components. These input-output relationships are tested on a sample of innovative Italian firms. A sample-selection approach is applied. Results show that in-house R&D is linked to the propensity to introduce product innovation both in mature firms and YICs; however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while − in contrast with the incumbent firms − in-house R&D does not play a significant role.

This paper investigates the determinants of R&D investment at the firm-level. A balanced panel of 215 Italian manufacturing firms over the 1995-2000 period has been used to test the technologypush, the demand-pull and the endogenous skill-bias hypotheses. Econometrically, the GMM-SYS estimator and the Least Squares Dummy Variable Corrected (LSDVC) estimator, a recentlyproposed panel data technique particularly suitable for small samples, have been used. Results support the well-established technology-push and demand-pull hypotheses and, furthermore, supply evidence for the role of skill endowment in increasing a firm’s R&D investments.

History has seen periods of change biased in favour of the unskilled: this was the case during the transition from the artisan-based to the factory-based system of production (Marx, 1961, Book I, Chap. XIII; Goldin and Katz, 1998), and of the massive introduction of Tayloristic methods in the 20th century (Braverman, 1974).

Previous studies have suggested that technological change is the main cause of the recent increase in demand for highly skilled workers in developed countries. However, a more recent strand of literature has also introduced the “Skill Biased Organisational Change” hypothesis, according to which the increasing diffusion of new organisational practices within firms plays a role in the increasing demand for skilled workers. We estimate a SUR model for a sample of 400 Italian manufacturing firms, showing that upskilling is more a function of reorganisational strategy than a consequence of technological change alone. Moreover, some evidence of superadditive effects emerges, which is consistent with the notion that technology and organisation jointly affect the demand for labour.