nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2017‒03‒19
ten papers chosen by
Fulvio Castellacci
Universitetet i Oslo

  1. The employment impact of R&D expenditures and capital formation By Mariacristina Piva; Marco Vivarelli
  2. Global Value Chains and Wages: International Evidence from Linked Worker-Industry Data By Aleksandra Parteka; Joanna Wolszczak-Derlacz
  3. Immigration externalities, knowledge flows and brain gain By Ernest MIGUELEZ; Claudia NOUMEDEM TEMGOUA
  4. Heterogeneous exporters: quantitative differences and qualitative similarities By Casas, Camila; Diez, Federico J.; Gonzalez, Alejandra
  5. Skills, Aging, and Productivity: Evidence from Panel Data By Kotschy, Rainer; Sunde, Uwe
  6. Firm and Regional Factors of Productivity: A Multilevel Analysis of Tunisian Manufacturing By Mohamed Amara; Khaled Thabet
  7. Managers and Productivity Differences By Nezih Guner; Andrii Parkhomenko; Gustavo Ventura
  8. Services In Global Value Chains: From Inputs to Value-Creating Activities By Sébastien Miroudot; Charles Cadestin
  9. The Indirect Effects of FDI on Trade: A Network Perspective By Rodolfo Metulini; Massimo Riccaboni; Paolo Sgrignoli; Zhen Zhu;
  10. The development and typology of the employment structure in OECD countries By Sepp, Jüri; Kaldaru, Helje; Varblane, Uku

  1. By: Mariacristina Piva (DISCE, Università Cattolica); Marco Vivarelli (DISCE, Università Cattolica - UNU-MERIT, Maastricht, The Netherlands and IZA, Bonn, Germany)
    Abstract: The aim of this paper is twofold. On the one hand, the economic insights about the employment impact of technological change are disentangled starting from the classical economists to nowadays 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 labour-friendly impact of R&D expenditures (mainly related to product innovation) is found; yet, this positive employment effect appears to be entirely due to the medium-and high-tech sectors, while no effect can be detected in the low-tech industries; 2) capital formation is found to be negatively related to employment; this outcome points to a possible labour-saving effect due to the embodied technological change incorporated in gross investment (mainly related to process innovation).
    Keywords: technological change, employment, sectoral analysis, EU
    JEL: O33
    Date: 2017–01
  2. By: Aleksandra Parteka; Joanna Wolszczak-Derlacz
    Abstract: Using a rich dataset on over 110,000 workers from nine European countries and the USA we study the wage response to industry dependence on foreign value added. We estimate a Mincerian wage model augmented with an input-output interindustry linkages measure accounting for task heterogeneity across workers. Low and mediumeducated workers and those performing routine tasks experience (little) wage decline due to major dependency of their industries on foreign inputs. Workers from former EU15 are more in danger of unfavourable wage effects than workers from new EU member states. American workers employed in service industries are more exposed than manufacturing workers.
    Keywords: wage, global value chains, foreign value added, interindustry linkages
    JEL: F14 F16 J31
    Date: 2016–09
    Abstract: This paper documents the influence of networks of highly-skilled migrants on international knowledge flows. It adds to the growing literature on highly-skilled international migration and its contribution to international knowledge diffusion, in migrants’ home as well as host countries. In particular, it first explores knowledge feedbacks to home countries generated by migrant inventors, a representative category of high-skilled migrants, most of them scientists and engineers. Second, it investigates the knowledge inflows to host countries brought by inventors. We test our hypothesis of a positive relationship between knowledge flows and highly skilled migration in a country-pair gravity model setting, for the period 1990-2010, using patent citations across countries as a measure of international knowledge diffusion. Our results confirm our initial assumption on the positive impact of highly skilled migrants on knowledge flows to their homelands as well as to their host countries. We find doubling the number of inventors of a given nationality at a destination country, leads to an 8.3% increase in knowledge outflows to their home economy from that same host land; while a similar increase in the number of migrant inventors produces a 6% increase in the knowledge inflows to the host economy.
    Keywords: migration, brain gain, diaspora, diffusion, inventors, patents, PCT patents
    JEL: C8 J61 O31 O33
    Date: 2017
  4. By: Casas, Camila (Banco de la República (Colombia)); Diez, Federico J. (Federal Reserve Bank of Boston); Gonzalez, Alejandra (Banco de la República (Colombia))
    Abstract: We combine two detailed datasets on Colombian manufacturing firms and document several stylized facts on exporter heterogeneity of total factor productivity (TFP) and export-market orientation, refining some previously known facts and unveiling some new others. We first show that the exporter productivity premium is remarkably robust across the methodologies used to recover TFP. We then document that the most productive exporters are those that export (1) a higher share of their total production, (2) to a larger number of countries, (3) to destinations less frequently reached by other exporters, (4) a larger number of products, and (5) with greater frequency and stability. In contrast, (6) the type of destination country or (7) the type of exported product has no significant effect on exporter productivity differences. These facts are robust to alternative definitions and specifications and can provide useful guidelines for policy makers.
    Keywords: productivity premium; export intensity; export extensive margins
    JEL: D24 F14 L60
    Date: 2017–01–13
  5. By: Kotschy, Rainer; Sunde, Uwe
    Abstract: The demographic change is one of the most important challenges for many developed economies in the twenty-first century. This paper examines the effect of workforce demographics and the distribution of skills on aggregated productivity and output. Population aging may lead to secular stagnation in developed economies. We provide estimates for an upper boundary of the skills-aging-elasticity that describes how much human capital is required to increase in order to offset negative effects of aging in the most favorable setting.
    JEL: J11 O47 J10
    Date: 2016
  6. By: Mohamed Amara (University of Tunis); Khaled Thabet
    Abstract: In this paper, we use multilevel models to simultaneously analyze individual, sectoral and regional characteristics that might affect the total factor productivity of Tunisian manufacturing firms for the period 1998-2004. Our results show that the individual characteristics of the firm have an important effect on both total factor productivity and labor productivity. We find that the oldest small firms are more productive than larger firms. Regional context has a significant direct impact on firms’ performance. More specifically, industrial density has a positive influence on total factor productivity. Our results show also that interaction effects or indirect effects are mostly driven by sectoral context. The intra-industrial wage disparities are beneficial only for firms with higher human capital and R&D. The interaction effects also show that larger and older firms will benefit more from industrial agglomeration. We conclude that multilevel models better fit our research questions that combine firm and contextual characteristics simultaneously, because they allow firm-specific characteristics to be differently associated to their regional and sectoral contexts.
    Date: 2016–01–09
  7. By: Nezih Guner; Andrii Parkhomenko; Gustavo Ventura
    Abstract: We document that for a group of high-income countries (i) mean earnings of managers tend to grow faster than for non managers over the life cycle; (ii) the earnings growth of managers relative to non managers over the life cycle is positively correlated with output per worker. We interpret this evidence through the lens of an equilibrium life-cycle, span-of-control model where managers invest in their skills. We parameterize this model with U.S. observations on managerial earnings, the size-distribution of plants and macroeconomic aggregates. We then quantify the relative importance of exogenous productivity differences, and the size-dependent distortions emphasized in the misallocation literature. Our findings indicate that such distortions are critical to generate the observed differences in the growth of relative managerial earnings across countries. Thus, observations on the relative earnings growth of managers become natural targets to discipline the level of distortions. Distortions that halve the growth of relative managerial earnings (a move from the U.S. to Italy in our data), lead to a reduction in managerial quality of 27% and to a reduction in output of about 7% – more than half of the observed gap between the U.S. and Italy. We find that crosscountry variation in distortions accounts for about 42% of the cross-country variation in output per worker gap with the U.S.
    Keywords: Managers, Management, Practices, Distortions, Size, Skill Investments, Productivity Differences
    JEL: E23 E24 J24 M11 O43 O47
    Date: 2015–12
  8. By: Sébastien Miroudot; Charles Cadestin
    Abstract: This report provides new evidence on the role of services in global value chains (GVCs). With the release of the Trade in Value Added database, it was highlighted that services account for a larger share of world trade than suggested by traditional statistics. But this evidence does not tell the whole story about services in GVCs. In addition to services bought as inputs, there are also services activities within manufacturing firms. Moreover, manufacturing companies increasingly produce and export services either as complements or substitutes to the goods they sell. This shift to services is related to strategies aiming at adding more value and creating a long-term relationship with customers. The report highlights that services inputs, whether domestic or foreign, account for about 37% of the value of manufacturing exports in the sample of countries covered. By adding service activities within manufacturing firms, this share increases to 53% and the overall contribution of services to exports is close to two-thirds. Across countries, between 25% and 60% of employment in manufacturing firms is found in service support functions such as R&D, engineering, transport, logistics, distribution, marketing, sales, after-sale services, IT, management and back-office support. SMEs are also part of this “servicification” and contribute to exports of services bundled with goods.
    Keywords: bundles of goods and services, business functions, Global Value Chains, Services, servicification, trade in services, trade in value-added
    JEL: F13 F14 F23 F68 L80
    Date: 2017–03–15
  9. By: Rodolfo Metulini (Department of economics and management, University of Brescia); Massimo Riccaboni (IMT School for advanced studies); Paolo Sgrignoli (Institute for economics, Scuola Superiore Sant'Anna, Pisa); Zhen Zhu (IMT School for advanced studies);
    Abstract: The relationship between international trade and foreign direct investment (FDI) is one of the main features of globalization. In this paper we investigate the effects of FDI on trade from a network perspective, since FDI takes not only direct but also indirect channels from origin to destination countries because of firms' incentive to reduce tax burden, to minimize coordination costs, and to break barriers to market entry. We use a unique data set of international corporate control as a measure of stock FDI to construct a corporate control network (CCN) where the nodes are the countries and the edges are the corporate control relation ships. Based on the CCN, the network measures, i.e., the shortest path length and the communicability, are computed to capture the indirect channel of FDI. Empirically we find that corporate control has a positive effect on trade both directly and indirectly. The result is robust with different specifications and estimation strategies. Hence, our paper provides strong empirical evidence of the indirect effects of FDI on trade. Moreover, we identify a number of interplaying factors such as regional trade agreements and the region of Asia. We also find that the indirect effects are more pronounced for manufacturing sectors than for primary sectors such as oil extraction and agriculture.
    Keywords: Networks; Foreign direct investment; Corporate control
    JEL: C21 F10 F14 F23 L22
    Date: 2017–03
  10. By: Sepp, Jüri; Kaldaru, Helje; Varblane, Uku
    Abstract: Sectoral changes are nowadays an integral feature of economic development in all countries and hence gaining attention of several economists. Structural changes occur in different aggregation levels, from inter-industry change to inter-sectoral change. In this paper we are considering shifts at more aggregated sectoral level. The purpose of this paper is to analyze the specificities of the process of tertiarization of OECD countries. For this purpose, multidimensional analysis of branch-structure of OECD countries is implemented using STAN (Structural Analysis) database. First, an overview of the OECD averages is presented. Then cluster analysis is applied to explain how the countries are grouped on the basis of the similarity of branch-structure. Also the changes in the period 2000-2009 are examined. Finally, discriminant analysis is applied to determine the latent indicators that distinguish the branch structure of the OECD countries. Then, the typology of countries and its dynamics, including the process of convergence of income levels, can be viewed in a more general space of discriminant functions.
    Keywords: structural change,tertiarization,typology of countries,cluster analysis,discriminant analysis
    Date: 2017

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