Technological change and employment: is Europe ready for the challenge?

M. Piva, M. Vivarelli

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

The aim of this paper is twofold. On the one hand, the economic insights on the employment impact of technological change are discussed covering both classical theories and updated theoretical and empirical analyses. On the other hand, an empirical test is provided; in particular, longitudinal data—covering manufacturing and service sectors over the 1998–2011 period for 11 European countries—are used to run GMM-SYS and LSDVC estimates. Two are the main results: (1) a significant labor-friendly impact of R&D expenditures (mainly related to product innovation) is found; yet, this positive employment effect appears to be entirely due to medium and high-tech sectors, while no effect can be detected in low-tech industries; (2) capital formation is found to be negatively related to employment; this outcome suggests a possible labor-saving effect due to the embodied technological change incorporated in gross investment (mainly related to process innovation).
Original languageEnglish
Pages (from-to)13-32
Number of pages20
JournalEurasian Business Review
Volume8
Issue number1
DOIs
Publication statusPublished - Mar 2018

JEL classifications

  • o33 - "Technological Change: Choices and Consequences; Diffusion Processes"
  • j21 - Labor Force and Employment, Size, and Structure

Keywords

  • Employment
  • EU
  • Sectoral analysis
  • Technological change
  • COUNTRIES
  • RESEARCH-AND-DEVELOPMENT
  • FIRM-LEVEL
  • SKILLS
  • INNOVATION
  • ESTIMATOR
  • JOB CREATION
  • PANEL-DATA
  • PRODUCTIVITY
  • EFFICIENCY

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