Which firms want PhDs? The effect of the university-industry relationship on the PhD labour market

PhD graduates hold the highest education degree, are trained to conduct research and can be considered a key element in the creation, commercialization and diffusion of innovations. The impact of PhDs on innovation and economic development takes place through several channels such as the accumulation of scientific capital stock, the enhancement of technology transfers and the promotion of cooperation relationships in innovation processes. Although the placement of PhDs in industry provides a very important mechanism for transmitting knowledge from universities to firms, information about the characteristics of the firms that employ PhDs is very scarce. The goal of this paper is to improve understanding of the determinants of the demand for PhDs in the private sector. Three main potential determinants of the demand for PhDs are considered: cooperation between firms and universities, R&D activities of firms and several characteristics of firms, size, sector, productivity and age. The results from the econometric analysis show that cooperation between firms and universities encourages firms to recruit PhDs and point to the existence of accumulative effects in the hiring of PhD graduates.

Parental education and family characteristics: educational opportunities across cohorts in Italy and Spain

Drawing on data contained in the 2005 EU-SILC, this paper investigates the disparities in educational opportunities in Italy and Spain. Its main objective is to analyse the predicted probabilities of successfully completing upper-secondary and tertiary education for individuals with different parental backgrounds, and the changes in these probabilities across birth cohorts extending from 1940 to 1980. The results suggest that the disparities in tertiary education opportunities in Italy tend to increase over time. By contrast, the gap in educational opportunity in Spain shows a marked decrease across the cohorts. Moreover, by using an intuitive decomposition strategy, the paper shows that a large part of the educational gap between individuals of different backgrounds is “composed” of the difference in the endowment of family characteristics. Specifically, it seems that more highly educated parents are more able to endow their children with a better composition of family characteristics, which accounts for a significant proportion of the disparities in educational opportunity.

Employment effects of service offshoring: evidence from matched firms

This paper studies the effects of service offshoring on the level and skill composition of domestic employment, using a rich data set of Italian firms and propensity score matching techniques. The results show that service offshoring has no effect on the level of employment but changes its composition in favor of high skilled workers.

Mechanisms of agglomeration: Evidence from the location of new manufacturing firms in Spain

El objetivo de esta investigación es aportar evidencia sobre las fuentes de las economías de aglomeración para el caso español. De todas las maneras posibles que se han tomado en la literatura para medir las economías de aglomeración, nosotros lo analizamos a partir de las decisiones de localización de las empresas manufactureras. La literatura reciente ha puesto de relieve que el análisis basado en la disyuntiva localización / urbanización (relaciones dentro de un mismo sector) no es suficiente para entender las economías de aglomeración. Sin embargo, las relaciones entre los diferentes sectores sí resultan significativas al examinar por qué las empresas que pertenecen a diferentes sectores se localizan unas al lado de las otras. Con esto en mente, intentamos explicar que relaciones entre diferentes sectores pueden explicar coaglomeración. Para ello, nos centramos en aquellas relaciones entre sectores definidos a partir de los mecanismos de aglomeración de Marshall, es decir, labor market, input sharing y knowledge spillovers. Trabajamos con el labor market pooling en la medida en que los dos sectores utilizan los mismos trabajadores (clasificación de ocupaciones). Con el segundo mecanismo de Marshall, input sharing, introducimos cómo dos sectores tienen una relación de comprador / vendedor. Por último, nos referimos a dos sectores que utilizan las mismas tecnologías en cuanto a los knowledge spillovers. Con el fin de capturar todos los efectos de los mecanismos de aglomeracion en España, en esta investigación trabajamos con dos ámbitos geográficos, los municipios y los mercados de trabajo locales. La literatura existente nunca se ha puesto de acuerdo en cual es el ámbito geográfico en el que mejor trabajan los mecanismos Marshall, por lo que hemos cubierto todas las unidades geográficas potenciales.

Product differentiation, competitive pressure and the effects of innovation on the success and survivability of firms in oligopoly markets

In a recent paper Tishler and Milstein (2009) fi…nd that increased competition may increase aggregate R&D spending while market output decreases. Therefore, they obtain the surprising result that R&D spending is excessive when competition becomes intense. Their result is based on the standard linear demand function for differentiated products introduced by Bowley (1924) where decreased product differentiation is interpreted as more competitive pressure. In this paper I show that at an aggregate level this interpretation is problematic because equilibrium effects are dominated by a demand reduction effect. A slight modifi…cation of the standard demand function eliminates this effect. For the Tishler and Milstein (2009) setting it is shown that then increased competition increases both R&D spending and aggregate market output. Therefore, at least for consumers, more intense competition increases welfare. Journal of Economic Literature Classi…fication Numbers: D43, L1, O3. Keywords: Oligopoly markets, Product differentiation, Competitive pressure.

Multinationals, R&D and productivity: Evidence for UK Manufactoring firms

In this study we analyze multinationality (domestic-based firms vs. multinationals) and foreignness (foreign vs. domestic firms) effects in the returns of R&D to productivity. We follow a two-step strategy. In the first step, we consistently ''s productivity by GMM and numerically compute the sample distribution of the R&D returns. In the second step, we use stochastic dominance techniques to make inferences on the multinationality and foreignness effects. Results for a panel of UK manufacturing firms suggest that multinationality and foreignness effects operate in an opposite way: whilst the multinationality effect enhances R&D returns, the foreignness diminishes them.

Are small firms more sensitive to financial variables?

This paper analyses the impact of different sources of finance on the growth of firms. sing panel data from Spanish manufacturing firms for the period 2000-2006, we investigate the effects of internal and external finances on firm growth. In particular, we examine wo dimensions of these financial sources: a) the performance of the firms' capital structure n accordance with firm size; b) the combined effect of equity, external debt and cash low n firm growth. We find that low-growth firms are sensitive to cash low and short-term ank debt, while high-growth firms are more sensitive to long-term debt. Furthermore, ur results show that low-growth firms are more sensitive to short-term financial variables, hile fast growth firms are more sensitive to long-term financial variables. EL codes: L25, R12. eywords: Finance, Firm growth, Quantile regressions, Small firms

Location Determinants of New Firms: Does Skill Level of Human Capital Really Matter?

This paper is about the role played by stock of human capital on location decisions of new manufacturing plants. We analyse the effect of several skill levels (from basic school to PhD) on decisions about the location of plants in various industries and, therefore, of different technological levels. We also test whether spatial aggregation level biases the results and determine the most appropriate areas to be considered in analyses of these phenomena. Our main statistical source is the Register of Manufacturing Establishments of Catalonia (REIC), which has plant-level microdata on the locations of new manufacturing plants. Keywords: agglomeration economies, industrial location, human capital, count-data models, spatial econometrics.

A New open economy macroeconomic model with endogenous portfolio diversification and firms entry

This paper provides a new benchmark for the analysis of the international diversi…cation puzzle in a tractable new open economy macroeconomic model. Building on Cole and Obstfeld (1991) and Heathcote and Perri (2009), this model speci…es an equilibrium model of perfect risk sharing in incomplete markets, with endogenous portfolios and number of varieties. Equity home bias may not be a puzzle but a perfectly optimal allocation for hedging risk. In contrast to previous work, the model shows that: (i) optimal international portfolio diversi…cation is driven by home bias in capital goods, independently of home bias in consumption, and by the share of income accruing to labour. The model explains reasonably well the recent patterns of portfolio allocations in developed economies; and (ii) optimal portfolio shares are independent of market dynamics.

R&D cooperation between Spanish firms and scientific partners: what is the role of tertiary education?

This paper explores the factors that determine firm’s R&D cooperation with different partners, paying special attention on the role of tertiary education (degree and PhDs level) in facilitating the connection between the firms and the to scientific bodies (technology centres, public research centres and universities). Here, we attempt to answer two questions. First, are innovative firms that carry out internal and external R&D activities more likely to cooperate on R&D projects with other partners? Second, do Spanish innovative firms with a high participation of researchers with degrees or PhDs tend to cooperate more with scientific partners? To answer both questions we apply a three-dimensional approach on a firm level Panel Data with a sample of 4.998 manufacturing and services Spanish firms. First, we run a complementary test between external R&D acquisition and skilled research workers and find that firms which carry out external R&D activities obtain a greater return on R&D cooperation when they have skilled workers in R&D, especially in high-tech manufactures and KIS services. Second, we carry out a 2-step tobit model to estimate, in the first stage, the determinants that explain whether Spanish innovative firms cooperate or not; and in the second stage the factors that affect the choice of partners. And third, we apply an ordered probit model to test the marginal effects of explanatory variables on the different partners. Here we contrast some of the most interesting empirical hypotheses of previous studies, and which emphasize the role of employees with degrees and PhDs in facilitating cooperative R&D between firms and scientific partners.

The Innovation and Imitation Dichotomy in Spanish firms: do absorptive capacity and the technological frontier matter?

This paper analyses whether a firm’s absorptive capacity and its distance from the technological frontier affect the choice between innovation and imitation in innovative Spanish firms. From an extensive survey of 5,575 firms during the 2004-2009 period, we found two significant results. With regard to the role of absorptive capacity, the empirical evidence shows that when innovative firms have difficulties in accessing external information and hire skilled workers, their innovative capacity is reduced. Meanwhile, with regard to distance from the technological frontier, the firms that reduce this gap manage to increase their innovative capacity at the expense of imitation. To summarise, when we studied firms’ absorptive capacity and their relative position to the technological frontier in tandem, we found that the two factors directly affected firms' ability to innovate or imitate.

An investigation on the pay-off to generic competences for core employees in Catalan manufacturing firms

The aim of this paper is to measure the returns to human capital. We use a unique data set consisting of matched employer-employee information. Data on individuals' human capital include a set of 26 competences that capture the utilization of workers' skills in a very detailed way. Thus, we can expand the concept of human capital and discuss the type of skills that are more productive in the workplace and, hence, generate a higher payoff for the workers. The rich information on firm's and workplace characteristics allows us to introduce a broad range of controls and to improve previous research in this field. This paper gives evidence that the returns to generic competences differ depending on the position of the worker in the firm. Only numeracy skills are reward independent of the occupational status of the worker. The level of technology used by the firm in the production process does not directly increase workers’ pay, but it influences the pay-off to some of the competences. JEL Classification: J24, J31

Productivity in southern European small firms: When and how work organization complements process innovation

The aim of this paper is to analyse the effects of human capital, advanced manufacturing technologies (AMT), and new work organizational practices on firm productivity, while taking into account the synergies existing between them. This study expands current knowledge in this area in two ways. First, in contrast with previous works, we focus on AMT and not ICT (information and communication technologies). Second, we use a unique employer-employee data set for small firms in a particular area of southern Europe (Catalonia, Spain). Using a small firm data set, allows us to analyse the particular case of small and medium enterprises, since we cannot assume they have the same characteristics as large firms. The results provide evidence in favor of the complementarity hypothesis between human capital, advanced manufacturing technologies, and new work organization practices, although we show that the complementarity effects depend on what type of work organization practices are used by a firm. For small and medium Catalan firms, the only set of work organization practices that improve the benefits of human capital and technology investment are those practices which are more quality oriented, such as quality circles, problem-solving groups or total quality management.

Workers cooperation within the firm: an analysis using small and medium size firms

We investigate the determinants of teamwork and workers cooperation within the firm. Up to now the literature has almost exclusively focused on workers incentives as the main determinants for workers cooperation. We take a broader look at the firm's organizational design and analyze the impact that different aspects of it might have on cooperation. In particular, we consider the way in which the degree of decentralization of decisions and the use of complementary HRM practices (what we call the .rm.s vertical organizational design) can affect workers'collaboration with each other. We test the model's predictions on a unique dataset on Spanish small and medium size firms containing a rich set of variables that allows us to use sensible proxies for workers cooperation. We find that the decentralization of labor decisions (and to a less extent that of task planning) has a positive impact on workers cooperation. Likewise, cooperation is positively correlated to many of the HRM practices that seem to favor workers'interaction the most. We also confirm the previous finding that collaborative efforts respond positively to pay incentives, and particularly, to group or company incentives.

Innovation or Imitation? The effect of spillovers and competitive pressure on firms' R&D strategy choice

This article provides a theoretical and empirical analysis of a firm's optimal R&D strategy choice. In this paper a firm's R&D strategy is assumed to be endogenous and allowed to depend on both internal firms. characteristics and external factors. Firms choose between two strategies, either they engage in R&D or abstain from own R&D and imitate the outcomes of innovators. In the theoretical model this yields three types of equilibria in which either all firms innovate, some firms innovate and others imitate, or no firm innovates. Firms'equilibrium strategies crucially depend on external factors. We find that the efficiency of intellectual property rights protection positively affects firms'incentives to engage in R&D, while competitive pressure has a negative effect. In addition, smaller firms are found to be more likely to become imitators when the product is homogeneous and the level of spillovers is high. These results are supported by empirical evidence for German .rms from manufacturing and services sectors. Regarding social welfare our results indicate that strengthening intellectual property protection can have an ambiguous effect. In markets characterized by a high rate of innovation a reduction of intellectual property rights protection can discourage innovative performance substantially. However, a reduction of patent protection can also increase social welfare because it may induce imitation. This indicates that policy issues such as the optimal length and breadth of patent protection cannot be resolved without taking into account specific market and firm characteristics. Journal of Economic Literature Classification Numbers: C35, D43, L13, L22, O31. Keywords: Innovation; imitation; spillovers; product differentiation; market competition; intellectual property rights protection.