Explaining Growth Differences across Firms: The Interplay between Innovation and Management Practices
This paper provides first empirical evidence of the joint effects that innovation strategies and human resource management practices exert on firm growth. By exploiting unique information from a large sample of Italian manufacturing companies in the very recent years, it shows that investing in technology and implementing performance-based pay policies are both positively associated with a significant turnover, employment and labor productivity growth premium. However, their joint adoption does not necessarily sum the two effects. In particular, performance-based rewards boost growth of non-innovators and of firms pursuing relatively simple innovation strategies, centered around the acquisition of embodied technology. For firms strongly relying on R&D as an additional lever for product and process upgrading, the estimated effect of having in place monetary incentive mechanisms is null or even negative.
Inward greenfield FDI and patterns of job polarization
The unprecedented growth in FDI in the last decades has caused drastic changes in the labour markets of the host countries. The major part of FDI takes place in low tech industries, where the wages and skills are low, or in high tech, where they offer a wage premium for the highly skilled workers. This mechanism may increase the polarization of employment into high-wage and low-wage jobs, at the expenses of middle-skill jobs. This paper looks at the effects of two types of FDI inflows, namely foreign investment in high-skill and low-skill activities, on skill polarization. We match data on greenfield FDI aggregated by country and sector with data on employment by occupational skill to investigate the extent to which differ types of greenfield FDI are responsible for skill polarization.
From R&D to market: using trademarks to capture the market capability of top R&D investors
Authors: Carolina Castaldi, Mafini Dosso
This paper investigates the links between the market capability of top corporate R&D investors (EU Industrial R&D Investment Scoreboards), as captured by trademark data and their economic performance in terms of net sales growth. It provides empirical evidence to better understand the extent to which companies, operating in different industrial sectors, combine technological capabilities with commercialization efforts to generate and appropriate the economic returns of their R&D investments. This paper shows how different dimensions of firms' market capabilities can be captured through trademark indicators. The results suggest that complementing R&D efforts and patenting activities with strong and specific market capabilities can indeed yield significant growth premiums. Moreover, offering services seems to pay off depending on the intensity of R&D investments. Yet, a quantile regression approach and a series of robustness checks indicate that such effects differ across the quantiles of the conditional sales growth distribution.