Which skills contribute most to absorptive capacity, innovation and productivity performance? Evidence from the US and Western Europe
Skills are widely recognised as central to absorptive capacity, that is, firms' ability to identify and make effective use of knowledge, ideas and technologies that are generated elsewhere. But identification of the specific levels of education and skills that contribute most to the development...
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Published in | Economics of innovation and new technology Vol. 29; no. 3; pp. 223 - 241 |
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Main Authors | , , |
Format | Journal Article |
Language | English |
Published |
Abingdon
Routledge
02.04.2020
Taylor & Francis Ltd |
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Abstract | Skills are widely recognised as central to absorptive capacity, that is, firms' ability to identify and make effective use of knowledge, ideas and technologies that are generated elsewhere. But identification of the specific levels of education and skills that contribute most to the development of absorptive capacity is often hampered by the use of skill measures as proxies for absorptive capacity itself. Drawing on a cross-country industry-level dataset, we retain separate measures of key components of absorptive capacity, namely, skills, R&D investments and openness to foreign trade and investment. We then estimate a system of structural equations in order to evaluate the extent to which different levels of skill contribute to innovative output (measured by growth in patenting) and subsequently to growth in productivity. We find important roles for both high-level skills and upper intermediate (technician-level) skills in converting the knowledge sourcing opportunities provided by openness into innovative output. In final stages of production (making use of innovative output), productivity growth in countries near to the technological frontier is enhanced not just by high-level and upper intermediate skills but also by the skills of the workforce as a whole. |
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AbstractList | Skills are widely recognised as central to absorptive capacity, that is, firms’ ability to identify and make effective use of knowledge, ideas and technologies that are generated elsewhere. But identification of the specific levels of education and skills that contribute most to the development of absorptive capacity is often hampered by the use of skill measures as proxies for absorptive capacity itself. Drawing on a cross-country industry-level dataset, we retain separate measures of key components of absorptive capacity, namely, skills, R&D investments and openness to foreign trade and investment. We then estimate a system of structural equations in order to evaluate the extent to which different levels of skill contribute to innovative output (measured by growth in patenting) and subsequently to growth in productivity. We find important roles for both high-level skills and upper intermediate (technician-level) skills in converting the knowledge sourcing opportunities provided by openness into innovative output. In final stages of production (making use of innovative output), productivity growth in countries near to the technological frontier is enhanced not just by high-level and upper intermediate skills but also by the skills of the workforce as a whole. |
Author | Mason, Geoff Venturini, Francesco Rincon-Aznar, Ana |
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Snippet | Skills are widely recognised as central to absorptive capacity, that is, firms' ability to identify and make effective use of knowledge, ideas and technologies... Skills are widely recognised as central to absorptive capacity, that is, firms’ ability to identify and make effective use of knowledge, ideas and technologies... |
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SubjectTerms | Absorptive capacity Absorptivity innovation Innovations International trade Levels Openness Patenting Productivity R&D Research & development Skills Workforce |
Title | Which skills contribute most to absorptive capacity, innovation and productivity performance? Evidence from the US and Western Europe |
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