the eu 2020 innovation indicator a step forward in measuring innovation outputs and outcomes in october 2013 the european commission presented a new indicator intended to capture innovation outputs and outcomes and thereby support policy makers in establishing new or reinforced actions to remove bottlenecks that prevent innovators from translating ideas into products and services that can be successful on the market this article aims to evaluate the usefulness of the new indicator against the background of the difficulties in measuring innovation outputs and outcomes we develop a unique conceptual framework for measuring innovation outcomes that distinguishes structural change and structural upgrading as two key dimensions in both manufacturing and services we conclude that the new indicator is biased towards a somewhat narrowly defined high tech understanding of innovation outcomes we illustrate our framework proposing a broader set of outcome indicators capturing also structural upgrading we find that the results for the modified indicator differ substantially for a number of countries with potentially wide ranging consequences for innovation and industrial policies

looking for hysteresis in coal consumption in the us abstract this paper estimates an unobserved components model to explore coal consumption in the usa we ask whether coal consumption exhibits hysteresis defined as a dynamic structure in which the cyclical component of coal consumption has permanent effects on the natural component in contrast to previous analysis we provide evidence in favor of hysteresis in coal consumption by using the nonlinear framework proposed recently by perez alonso and di sanzo 13 in which threshold type nonlinearities are introduced by allowing past cyclical consumption to have a different impact on the natural component depending on the regime the article discusses implications of the findings for energy conservation policies

network structure and regional innovation a study of university industry ties the emergence of the network paradigm has led to growing interest in understanding network structures relating to knowledge flows and patterns of regional innovation this paper explores the structure of knowledge networks stemming from ties between universities and other actors principally firms based upon a network analysis of empirical data for regions across the uk it is found that the most innovative and economically developed regions are more likely to be the location for actors holding highly central and influential positions within knowledge network architectures it is concluded that network structures and resulting stocks of structural network capital influence patterns of regional innovation and development

wage norms capital accumulation and unemployment a post keynesian view the paper presents a post keynesian view of unemployment it argues first that the effective labour demand need not be downward sloping with respect to real wages and aggregate demand need not be downward sloping with respect to inflation second that there is a broad case for unemployment hysteresis understood as endogeneity of the non accelerating inflation rate of unemployment nairu based on social norms in wage bargaining and on the supply side effects of capital accumulation and third that much as keynes argued capital investment rather than labour market institutions is the key variable to explain changes in aggregate unemployment performance across countries and over time overall the paper advocates a keynesian view of the nairu where effective demand determines unemployment in the short run and the deviation of actual unemployment from the nairu determines the change in inflation in the medium term the nairu is endogenous and follows actual unemployment copyright 2011 oxford university press

how labour market flexibility affects unemployment long term implications of the chain reaction theory this paper evaluates two theories of unemployment the natural rate theory whereby unemployment is depicted as fluctuating around a reasonably stable natural rate and the chain reaction theory which views movements in unemployment as the outcome of the interplay between labour market shocks and a network of lagged adjustment processes we show that for labour market systems with two common characteristics lagged endogenous variables and growing exogenous variables lags affect unemployment not only in the short run but in the long run as well the reason is that in the presence of growing exogenous variables the lagged responses are never able to work themselves out entirely in this respect the chain reaction theory contrasts sharply with the natural theory which commonly views unemployment as approaching a natural rate determined solely by the values of the exogenous variables the policy implications of the two theories are quite different as well for an empirical model of the uk market we show that unemployment does not converge to the natural rate as conventionally defined furthermore we show that lagged adjustment processes account for a substantial part of the uk long run equilibrium unemployment rate and for the movement of uk unemployment over the past 15 years this abstract was borrowed from another version of this item

labour market deregulation flexibility and innovation labour flexibility is often portrayed as important to competitive success using evidence from an original survey of uk firms this paper investigates the relationships between firms use of on the one hand various flexible work practices human resource management techniques and industrial relations systems and on the other hand the innovative activities of those firms our results suggest that the sort of low road labour flexibility practices encouraged by labour market deregulation short term and temporary contracts a lack of employer commitment to job security low levels of training and so on are negatively correlated with innovation

persistence in natural gas consumption in the us an unobserved component model abstract this article re examines the persistence in natural gas consumption using an alternative methodology in particular we report estimates of an unobserved components model in which hysteresis exists if cyclical and natural gas consumptions do not evolve independently in addition this framework is also extended by using the nonlinear approach in which nonlinearities are introduced by allowing past cyclical component to have a different impact on the natural component depending on the regime in a linear framework our results seem to indicate that hysteresis does not exist however when non linearity is taken into account we provide evidence in favor of hysteresis in natural gas consumption when the variations in natural gas consumption are above the threshold value we also selectively survey the empirical literature that examines the long term properties of energy series in order to put our contribution in perspective

innovations and r d in northern ireland manufacturing a schumpeterian approach harris r and trainor m 1995 innovations and r d in northern ireland manufacturing a schumpeterian approach reg studies 29 593 604 given the importance of r d and innovative outputs and the change in regional policy in the 1980s to encourage an enterprise culture based inter alia on a high rate of innovations this paper attempts to explain the determinants of inventive activities in one of the most disadvantaged regions of the united kingdom a model incorporating the impact of market structure is estimated and it is found that in northern ireland higher r d spending leads to a higher probability of innovating while r d itself is positively affected by higher post innovation price cost margins thus r d spending and innovation outputs are beneficial to profitability and thus presumably the long term growth of firms however while market structure is important the direct effects of monopoly power are if anything negative thus the results presented by geroski 1990 are support

hysteresis in unemployment after two decades of ratcheting unemployment in europe most economists agree that structural changes associated with higher equilibrium rates of unemployment have occurred but the direction of causality is a matter of controversy have the structural changes caused the long lasting increases in actual unemployment or have the increases in actual unemployment caused the structural changes the latter possibility is often referred to as hysteresis during the past decade a distinct research program has evolved around the idea that equilibrium employment tracks actual unemployment this survey reviews the various hysteretic explanations offered in the literature and evaluates their empirical standing

absorptive capacity socially enabling mechanisms and the role of learning from trial and error experiments a tribute to dan levinthal s contribution to international business research the concept of absorptive capacity ac of firms cohen and levinthal 1989 and 1990 is a foundational feature of organizational learning and adaptation that has had enormous influence in international business ib and innovation studies and management research in general in this tribute to dan levinthal we discuss the close connection between ac and learning two areas central to dan levinthal s research in relation to different contexts where ac comes into play in extant ib research we discuss four specific aspects of the nexus of ac and learning in the context of ib 1 bridging between intra and inter firm learning 2 a routine based framing of ac that emphasizes processes and capabilities underlying seeking assimilating and innovation in a global setting 3 the role of socially enabling mechanisms and 4 the logic of learning through trial and error experiments within firms and countries

effect of income on trust evidence from the 2009 economic crisis in russia this article draws on a natural experiment to identify the relationship between income and trust we use a unique panel data set on russia where gdp experienced an 8 drop in 2009 the effect of the crisis had been uneven among russian regions because of their differences in industrial structure inherited from the soviet period after instrumenting average regional income by soviet industrial structure we find that 10 decrease in income is associated with a five percentage point decrease in social trust we also find that post crisis economic recovery did not fully restore pre crisis trust level

the energy growth nexus reconsidered persistence and causality abstract this article applies a recent econometric framework to the analysis of the relationship between energy consumption and economic growth in the us which allows a joint study of causality and persistence we provide evidence suggesting a nonlinear relationship with a structural break in the most recent regime we find that gdp causes energy consumption and vice versa furthermore both series show persistence i e cyclical and natural components do not evolve independently thus policies oriented to the reduction of energy consumption could constrain economic growth and policy shocks can have permanent effects

the impact of monetary policy on unemployment hysteresis this article investigates the hypothesis that the extent to which hysteresis occurs in the aftermath of recessions depends on monetary policy reactions the degree of hysteresis is explained econometrically by the extent of monetary easing during a recession and by standard variables for labour market institutions in a pooled cross country analysis using quarterly data the sample includes 40 recessions in 19 organization for economic co operation and development oecd countries for which the required data is available the time period lasts for the period from 1980 to 2007 this article builds on ball 1999 and extends the sample of countries the time period under investigation and the set of control variables

china s nuclear export drive trojan horse or marshall plan abstract china s civil nuclear industry expanded strongly from 2008 onwards and nearly half of reactor construction starts worldwide since then are accounted for by the chinese home market increasingly china is turning its attention to the export market using its own designs which it claims emulate the safety standards of the latest designs of the established nuclear reactor vendors its export efforts would be greatly strengthened if it were to win an order from an established user of nuclear power and its best opportunity appears to be the uk where it is at the early stages of negotiating the construction of nuclear reactors the financial collapse of the french nuclear company areva gives it the opportunity to take a stake in the rescued companies giving it access to important fuel cycle technologies and perhaps the large french reactor service market its other export prospects in europe are in romania and turkey there are a number of issues european governments need to examine before committing to allow in chinese nuclear companies these include national security concerns about dependence on china for key infrastructure issues of quality control and regulatory competence and the lack of construction experience with china s modern reactor designs

dynamic complementarities in innovation strategies using a panel of irish manufacturing plants over the period 1991 2008 we test for dynamic complementarities in the joint use of internal r d and external knowledge sources we find little evidence either from considering successive cross sectional waves of comparable surveys or in terms of the strategy switch choices of specific plants that there has been a systematic move towards the joint use of internal and external knowledge in innovation we then test formally for the presence of complementarities in the joint use of internal r d and external innovation linkages in static terms we find no evidence of complementarity but in dynamic terms find evidence that strategy switches by individual plants towards a more open strategy are accompanied by increased innovation outputs

innovation in israel 1968 1997 a comparative analysis using patent data abstract the israeli high tech sector is widely regarded as a hotbed of cutting edge technologies and as the growth engine of the israeli economy in the 1990s and beyond in this paper we present a close up portrait of innovation in israel for the past 30 years with the aid of highly detailed patent data we use for that purpose all israeli patents taken in the us over 7000 as well as us patents and patents from other countries for comparative purposes the time path of israeli patenting reveals big jumps in the mid 1980s and then again in the early 1990s reflecting underlying shocks in policy and in the availability of relevant inputs israeli ranks high in terms of patents per capita compared to the g7 the asian tigers and a group of countries with similar gdp per capita finland is strikingly similar taiwan s patenting has grown extremely fast and is now on par with israel south korea is rapidly closing the gap the technological composition of israeli innovations reflects quite well worldwide technological trends except that computers and communications the fastest growing field in the us has grown even faster in israel the weak side resides in the composition of israeli assignees the actual owners of the intellectual property rights just 35 of israeli patents were assigned to israeli corporations a much lower percentage than in most other countries relatively large shares went to foreign assignees to universities and the government and to private inventors on the other hand israeli patents are of good quality in terms of citations received and getting better over time us patents command on average more citations but not in computers and communications or in biotechnology and israeli patents are significantly better than those of the reference group of countries

unemployment wage bargaining and capital labour substitution many economists believe that capital accumulation technical progress and labour force expansion have no lasting effect on unemployment this view rests on the empirically doubtful assumption that the elasticity of substitution between labour and capital is equal to unity i e production is cobb douglas using a simple model based on the work of layard nickell and jackman this paper demonstrates that with a lower elasticity of substitution the equilibrium unemployment rate is affected by all of the above factors it considers briefly how capital accumulation may be endogenised and what long run implications this has for unemployment copyright 1999 by oxford university press

the innovation performance of irish and foreign owned firms the roles of r d and networking this paper contributes to the growing evidence that irish and foreign owned firms based in ireland conduct their innovation activities differently from each other it tests the cohen and levinthal hypothesis separately for irish and foreign owned firms that undertaking r d and collaborating with external networks together enhance the probability of product and process innovation to control for potential endogeneity of the external networking variables a two step procedure is used with predicted probabilities used as instruments in the estimated production functions based on data from the irish community innovation survey 2006 to 2008 the results suggest that irish owned firms which engage in external networks with public knowledge sources while simultaneously undertaking r d are more likely to innovate than firms which perform these two activities individually irish owned firms which engage in backward networking for product and forward networking for process innovation while also undertaking r d are less likely to be innovative perhaps suggesting a substitution effect these results for irish owned firms provide some support for cohen and levinthal s hypothesis however foreign owned firms seem to behave differently being largely self contained and relying exclusively on intramural r d for innovation as the external networking variables both individually and when interacted with r d have no effect on innovation likelihood

the hinkley point decision an analysis of the policy process in 2006 the british government launched a policy to build nuclear power reactors based on a claim that the power produced would be competitive with fossil fuel and would require no public subsidy a decade later it is not clear how many if any orders will be placed and the claims on costs and subsidies have proved false despite this failure to deliver the policy is still being pursued with undiminished determination the finance model that is now proposed is seen as a model other european countries can follow so the success or otherwise of the british nuclear programme will have implications outside the uk this paper contends that the checks and balances that should weed out misguided policies have failed it argues that the most serious failure is with the civil service and its inability to provide politicians with high quality advice truth to power it concludes that the failure is likely to be due to the unwillingness of politicians to listen to opinions that conflict with their beliefs other weaknesses include the lack of energy expertise in the media the unwillingness of the public to engage in the policy process and the impotence of parliamentary committees

does unemployment hysteresis falsify the natural rate hypothesis a meta regression analysis abstract a quantitative survey of 24 studies containing 99 national estimates of unemployment persistence reinstates unemployment hysteresis as a viable falsifying hypothesis to the natural rate hypothesis empirical evidence to the contrary may be attributed to small sample misspecification and publication biases larger estimates of unemployment persistence are produced by models that use more information t 9 03 p 0 0001 and are better specified a theme of bias and misspecification among studies that are more supportive of natural rate hypothesis emerges in several independent ways the nonstationarity of the unemployment rate is confirmed both by the observed rate of convergence of persistence estimates across the empirical literature and by the point towards which they converge the natural rate hypothesis may be regarded as falsified should we choose to do so

living in limbo economic and social costs for refugees our paper tests the hypothesis that living in limbo could have negative consequences for the socio economic integration of refugees we define limbo as a protracted period when asylum seekers are waiting for the decision concerning their permanent refugee status relying on the french survey of migrants france s longitudinal survey of migrants elipa we measure integration by labour market participation fluency in french finding new french friends and studying to account for the endogeneity of limbo we instrument it with the administrative backlog we find that living longer in limbo during the asylum seeking period slows down future integration of refugees but results differ with respect to gender and educational attainment while having lived longer in limbo slows down most aspects of socio economic integration for refugees with no degree or a high school degree those with a bachelor s degree do not experience negative effects male refugees who had lived longer in limbo have a lower likelihood of being employed and studying in france while similar females make fewer french friends

attributing responsibility for energy justice a case study of the hinkley point nuclear complex since 2006 as part of the transition to low carbon technologies uk energy policy has moved towards incentivising new nuclear power production as a result the uk has developed a now delayed strategy to deliver around 16gw of new nuclear power by 2030 this policy context provides an opportunity to reflect not only on the material infrastructure needed to meet transition targets but also on who is responsible for the energy justice implications of these decisions using data collected from 26 semi structured interviews with ngo and policy representatives this paper presents a case study of energy justice concerns surrounding the hinkley point nuclear complex in somerset focusing particularly on the highly controversial hinkley point c developments the results emphasise the importance of considering not only instances of energy justice or injustice but of attributing responsibility for them a concept that has been largely overlooked in the energy justice literature ngos government and business allocate responsibility differently in nuclear energy decision making we find that perceptions of responsibility are highly dependent upon the level of transparency in decision making this article is part of a virtual special issue entitled exploring the energy justice nexus

knowledge stocks knowledge flows and innovation evidence from matched patents and innovation panel data successful innovation depends on knowledge technological strategic and market related in this paper we explore the role and interaction of firms existing knowledge stocks and current knowledge flows in shaping innovation success the paper contributes to our understanding of the determinants of firms innovation outputs and provides new information on the relationship between knowledge stocks as measured by patents and innovation output indicators our analysis uses innovation panel data relating to plants internal knowledge creation external knowledge search and innovation outputs firm level patent data is matched with this plant level innovation panel data to provide a measure of firms knowledge stock two substantive conclusions follow first existing knowledge stocks have weak negative rather than positive impacts on firms innovation outputs reflecting potential core rigidities or negative path dependencies rather than the accumulation of competitive advantages second knowledge flows derived from internal investment and external search dominate the effect of existing knowledge stocks on innovation performance both results emphasize the importance of firms knowledge search strategies our results also re emphasize the potential issues which arise when using patents as a measure of innovation

the beveridge curve in europe new evidence using national and regional data the beveridge curve depicts the empirical negative relationship between job vacancy rate and unemployment rate and reflects the efficiency of the job matching process movements along a fixed downward sloping beveridge curve are associated with cyclical shocks while shifts of the curve arise from structural factors that alter the matching efficiency between job vacancies and unemployed workers national and regional data on job vacancies and unemployment are combined to estimate the beveridge curves of five european countries and their regions focusing on the period 1975 to 2004 i also analyse whether shifts in european beveridge curves are due to changes in the composition of the unemployed pool labour market rigidities or cyclical and structural shocks the empirical evidence suggests that changes in labour market rigidities long term unemployment as well as cyclical shocks are responsible for outward shifts in european beveridge curves i also find evidence of nonlinearities in the relation betw

modelling the innovation value chain innovation events the introduction of new products or processes represent the end of a process of knowledge sourcing and transformation they also represent the beginning of a process of exploitation which may result in an improvement in the performance of the innovating business this recursive process of knowledge sourcing transformation and exploitation comprises the innovation value chain modelling the innovation value chain for a large group of manufacturing firms in ireland and northern ireland highlights the drivers of innovation productivity and firm growth in terms of knowledge sourcing we find strong complementarity between horizontal forwards backwards public and internal knowledge sourcing activities each of these forms of knowledge sourcing also makes a positive contribution to innovation in both products and processes although public knowledge sources have only an indirect effect on innovation outputs in the exploitation phase innovation in both products and processes contribute positively tocompany growth with product innovation having a short term disruption effect on labour productivity modelling the complete innovation value chain highlights the structure and complexity of the process of translating knowledge into business value and emphasises the role of skills capital investment and firms other resources in the value creation process

research and development cash flow agency and governance uk large companies this paper investigates the determinants of r d expenditure using a sample of uk listed companies with the highest spend from 2000 to 2005 we investigate the effect of corporate governance and ownership on r d using panel data the results provide some evidence that more governance tends to depress r d activity a finding that is robust to whether a composite or disaggregated index of governance is used one innovation of the paper is that we treat agency and finance effects interactively the ownership stake of the ceo appears to be supportive for r d

knowledge capital and performance heterogeneity a firm level innovation study this paper is an empirical analysis of knowledge capital and performance heterogeneity at the firm level we apply new econometric methods to extensive data on innovation and innovative activities

r d investment and financing choices a comprehensive perspective abstract we posit that the effects of r d investment on financing choices depend on the degree of intervention barriers and appropriation discrepancy between capital providers and the firm based on these two contingencies we categorize financing instruments into four types common equity common stock convertible securities preferred stock and convertible debt transactional debt corporate bonds and relational debt bank and commercial loans from the experiences of 39 petroleum firms during the period 1976 2005 we found r d investment has a positive effect on the use of common equity a u shaped effect on the use of convertible securities and an inverted u shaped effect on the use of relational debt to raise capital these effects are sustained over several years

hysteresis in unemployment unemployment has risen sharply in a number of countries and it appears to be becoming more persistent the experience of the 1970s and 1980s showed that adverse unemployment shocks could have long lasting effects with very serious economic and social consequences a key mechanism producing these adverse consequences was hysteresis in unemployment whereby temporary rises in unemployment generated by supply and or demand shocks had permanent or at least very persistent effects clearly it is important to understand how hysteresis mechanisms might operate in order to avoid such adverse outcomes on the other hand experience during the subsequent two decades showed that under more favourable macroeconomic conditions it is possible to observe good hysteresis effects now is a very appropriate time to re visit the issue of hysteresis in unemployment in order to avoid the errors of the 1970s and 1980s and if possible to get hysteresis effects working in a positive direction copyright 2011 oxford university press

general equilibrium macroeconomic models of unemployment can they explain the unemployment path in the oecd several theories which seek to explain the high and apparently persistent unemployment in the oecd countries over the past two decades have arisen within the framework of imperfections in the goods and labour markets probably the most prominent theories within this class of models are the general equilibrium models of phelps 1994 layard and nickell 1986 and layard et al 1991 labelled structuralist theories of unemployment by phelps 1994 common to the structuralist theories is that the low frequency movements in unemployment or the nairu are determined by structural variables such as unemployment benefits taxes real interest rates etc however the high frequency movements in unemployment are determined by wage and price surprises and in the layard and nickell 1986 model also by cyclical mark ups employment is entirely determined by the firms willingness to supply and the firms are never sales constrained by contrast the general equilibrium model of sarantis 1993 which is in post keynesian spirit suggests that unemployment on all frequencies is mainly an outcome of demand side factors in this model imperfections in the goods and labour markets are less important determinants of unemployment in this paper i estimate the extent to which the models of phelps 1994 layard and nickell 1986 henceforth l n and sarantis 1993 are able to explain the unemployment path of the oecd countries using annual data over the period 1960 to 1993 the theoretical set up of the models is presented in section 1 and the empirical estimates are set out in section 2

effectiveness and efficiency of sme innovation policy this paper assesses uk innovation policy impact on a large population weighted sample of both service and manufacturing smes by focussing on self reported innovation the study achieves a wider coverage of the effects of sme innovation policy than possible with more traditional indicators propensity score matching indicates that smes receiving uk state support for innovation were more likely to innovate than unsupported comparable enterprises innovating enterprises are shown to have grown significantly faster over the years 2002 2004 when other growth influences are appropriately controlled combining these two results and comparing the outlays on sme innovation policy with the estimated effects suggests that policy was efficient as well as effective there is evidence that sme tax credits were expensive compared with earlier support instruments but the overall high returns estimated suggest that even in times of public spending cuts persisting with sme innovation policy would be prudent

unit root tests persistence and the unemployment rate of the u s states author affiliation diego romero avila department of economics carretera de utrera km 1 pablo de olavide university 41013 seville spain dromtor upo escarlos usabiaga professor department of economics carretera de utrera km 1 pablo de olavide university 41013 seville spain cusaiba upo es corresponding author acknowledgment the authors would like to thank seminar participants at the pablo de olavide university and dg economics at the european central bank carlos usabiaga acknowledges the financial support from centro de estudios andaluces ecod1 05 033 special thanks go to junsoo lee and nikolay gospodinov for making available to us the codes to implement some of the techniques used in the paper and to two anonymous referees for suggestions that substantially improved the paper the usual disclaimer applies 1 introductionthe high persistence in unemployment rates observed in the developed world since the first oil shock has led to a vivid debate over which paradigm can better explain the behavior of unemployment rates the traditional strand of the literature that forms the basis of the natural rate theory phelps 1967 1968 friedman 1968 assumes that the unemployment rate evolves around an equilibrium level describing stationary fluctuations this equilibrium level or natural rate is set depending on fundamentals of the economy while initially the absence of theories explaining the determination of the natural rate meant that in practice it was taken to be constant and exogenous subsequent developments have attempted to identify the structural factors behind differences across economies and over time including labor productivity technological change real interest rates real exchange rates and energy prices to name a few see phelps 1994 phelps and zoega 1998 according to the structuralist view phelps 1994 most shocks to unemployment are temporary but occasionally the natural rate permanently changes and is affected by variations in the aforementioned structural factors as a consequence the unemployment rate may be characterized as a process that is stationary once a small number of structural breaks are allowed for in contrast to the natural rate and structuralist approaches the hysteresis hypothesis see blanchard and summers 1986 1987 implies that the unemployment rate is path dependent and temporary shocks can affect unemployment permanently 1 while hysteresis is thought to imply that the natural rate is conditioned by the level of unemployment recorded in the past persistence in unemployment which is a special case of the natural rate hypothesis entails a slow adjustment process of reversion toward the mean thus hysteresis implies that unemployment is characterized by a unit root while persistence is characterized by a near unit root in the latter case shocks to unemployment though long lasting would not have a permanent effect to discriminate among theories explaining the behavior of unemployment rates unit root tests have been widely applied the hysteresis hypothesis has been formulated as a unit root process and its rejection lends support to the natural rate hypothesis if no breaks are included in the specification and the structuralist hypothesis if breaks are allowed for the purpose of this article is to investigate which theoretical paradigm most closely represents the behavior of unemployment rates in the states of the united states over the period 1976 2004 we first apply the individual lagrange multiplier lm t statistic proposed by schmidt and phillips 1992 to monthly data and we fail to reject the null hypothesis of a unit root in unemployment for forty states perron 1989 pointed out that the presence of structural changes could favor the nonrejection of the unit root null if they are not properly accounted for therefore we employ the minimum lm t statistic allowing for up to two endogenous changes in level proposed by lee and strazicich 2003

unemployment questions and some answers in more or less every country in the oecd unemployment was lower in the decades following the second world war than in any other period of comparable length either before or since for example in britain unemployment has exceeded 5 in every peacetime decade from 1850 onwards except for the 1950s and 1960s alternatively as we can see in table 1 p 779 average unemployment in the 1980s and 90s is higher generally much higher than in the 1960s in every country considered why this is so is one of the questions which underlies this paper a second question which is also illustrated in the unemployment numbers presented in table 1 p 779 concerns the causes of the enormous variation in unemployment rates across the oecd countries as we shall see these are difficult questions the first in particular is one for which we do not have a complete answer by this i do not mean that we do not have theories which are broadly consistent with these numbers in fact we have theories consistent with more or less any numbers what we lack is a satisfactory empirical explanation of the time series pattern of oecd unemployment in what follows we remain focused on these two questions first considering the theoretical background and then looking at some possible answers we finish with some speculative conjectures on the first question

capital formation and unemployment this paper criticizes the current enthusiasm for labour market policies as the main route to employment creation in oecd countries such policies are normally seen as a means of encouraging more employment on existing capital stock this approach is one sided and downplays the equally important task of increasing productive capacity with more investment in productive capacity conventional labour market policies for increasing employment would be more effective and some might be unnecessary the paper analyses the role of capital stock within the framework of a simple nairu model based on previous work by the author it also presents some empirical evidence copyright 1995 by oxford university press

are shocks to energy consumption permanent or temporary evidence from 182 countries this article applies univariate and panel data unit root tests to annual panel data for 182 countries over the period 1979 2000 to examine the stationarity properties of per capita energy consumption the univariate unit root test can only reject the unit root null for 56 countries or 31 of the sample at the 10 level or better however univariate unit root tests have low power with short spans of data and therefore failure to reject the unit root null should be treated with caution when we apply the panel data unit root test we find overwhelming evidence that energy consumption is stationary we discuss the policy implications of these findings and offer suggestions for future research

an alternative demand indicator the non accelerating inflation rate of capacity utilization this article examines the usefulness of the naircu the non accelerating inflation rate of capacity utilization as a demand indicator of inflation for eight european countries so far the naircu has been estimated for the usa only where it serves as a useful indicator for inflation in most european countries deviations from the equilibrium level of capacity utilization influence inflation significantly further the results not only indicate that in more recent periods the naircu has shifted upward indicating higher efficiency of the production process but also that confidence intervals have increased over time reducing the usefulness of the naircu somewhat

how do we know that real wages are too high it is common belief that the wages that we observe are above the level that would prevail in a competitive labour market and also it is common to believe that wage moderation should be encouraged as a way to keep unemployment down this paper considers whether we can have confidence in these beliefs it presents a number of models designed to cast doubt on the conventional wisdom first we show that in an efficiency wage model in which there is involuntary unemployment a binding minimum wage may increase employment we then present a general equilibrium matching model in which there is involuntary unemployment but wages are below market clearing levels and raising wages can reduce unemployment we then consider the empirical evidence on employment and wage determination to argue that it is just as consistent with this model as with models in which wages are at or above market clearing levels

decoding the adaptability rigidity puzzle evidence from pharmaceutical incumbents pursuit of gene therapy and monoclonal antibodies the emergence of radical technologies presents a significant challenge to incumbent firms we study firms management of radical technological change by separating their actions into upstream research the r of r d and downstream development the d of r d we introduce two contingencies to explain when incumbents research investments in radical technologies translate into product development and when these upstream investments may get voided by organizational inertia downstream first radical technologies can differ in how they conform to incumbents existing business models impacting the extent to which the movement of research outputs toward development will be subject to inertial pressures second incumbents can invest in a radical technology through a variety of modes internal research external research contracts alliances acquisitions these modes represent unique combinations of who does research and who is involved in the decision for subsequent development and hence differ in the extent to which they are shielded from inertial pressures this difference helps explain why incumbents despite responding to radical technologies may still be unable to adapt as well as what types of investments will be more effective in helping firms navigate technological change evidence from pharmaceutical incumbents pursuit of monoclonal antibodies and gene therapy offers strong support for our arguments

the persistence of regional unemployment evidence from china the purpose of this paper is to examine the persistence of regional unemployment and to explore the sources of this persistence evidence from china suggests three empirical findings first provincial relative unemployment is more persistent than aggregate unemployment second youth unemployment is less persistent than total unemployment third although the western region has the highest provincial unemployment rate it has the lowest persistence of regional unemployment to explore the sources of this unemployment persistence a panel data method has been developed based on the barro approach and edwards work the higher the share of industry output by state sector and collective sector the more the regional unemployment persistence the private sector is the main employment destination for jobless now and has acted to reduce unemployment persistence

hysteresis in unemployment fact or fiction abstract a stylized fact of european unemployment dynamics is one of extreme persistence and possible unit root behavior this has led to a major reconsideration of the natural rate paradigm we apply the kalman filter to estimate the natural rate of unemployment for germany and france when the moving natural rate model is tested against the alternative of a unit root process the unit root hypothesis is resoundingly rejected

unemployment and the real wage the economic basis for contesting political ideologies using the keynesian theory of effective demand this paper demonstrates how particular models such as that of cooperative capitalism enunciated by the left keynesian social democrats the marxian model of profit squeeze emphasizing distributive conflict and even the conservative model relying on supply side stimulus fit in as particular variants of a more general theoretical scheme through a reconstruction of the familiar is schedule the argument is weaved around the theme of the relations between unemployment and real wage in the context of both a closed and an open economy to explain the common macroeconomic basis of contesting ideologies copyright 1990 by oxford university press

capital accumulation labour market institutions and unemployment in the medium run according to the mainstream view labour market institutions lmis are the key determinants of unemployment in the medium run the actual empirical explanatory power of measures for labour market institutions however has recently been called into question the keynesian view holds periods of high real interest rates and insufficient capital accumulation responsible for unemployment empirical work in this tradition has paid little attention to the role of lmis this paper contributes to the debate by highlighting the role of autonomous changes in capital accumulation as a macroeconomic shock in the empirical analysis medium term unemployment is explained by capital accumulation lmis and a number of macroeconomic shocks in a panel analysis covering 20 oecd countries the economic effects of changes in lmi variations in capital accumulation and other macro shocks are compared capital accumulation and the real interest rate are found to have statistically significant effects that are robust to the inclusion of control variables and show larger effects than lmi

innovation and university collaboration paradox and complexity within the knowledge economy the paper will explore the nature and impact of universities and other higher education institutions heis on firms innovation and growth in an increasingly distributed and open innovation system using a survey of some 400 firms in the uk the analysis reveals significant differences in firms collaboration with heis across the uk and the value and impact that such collaborations have on a firm s development the nature and effects of such collaboration vary significantly between the type of firm involved and their location and the analysis investigates this in relation to various aspects of innovative activity and firms performance much of the nature and effects of such collaboration are as one would expect counterintuitive and highlight the care we should place on assessing the role of universities and other heis in open innovation systems

high tech r d subsidies estimating the effects of sematech abstract sparked by concerns about their shrinking market share 14 leading u s semiconductor producers with the financial assistance of the u s government in the form of 100 million in annual subsidies formed a joint r d consortium sematech in 1987 using compustat data on all u s semiconductor firms we estimate the effects of sematech on members r d spending profitability investment and productivity in so doing we examine two hypotheses the commitment hypothesis that sematech obligates member firms to spend more on high spillover r d and the sharing hypothesis that sematech reduces duplication of member r d spending whereas the commitment hypothesis provides a rationale for the government subsidies the sharing hypothesis does not we find that sematech induced members to cut their overall r d spending on the order of 300 million per year providing support for the sharing hypothesis

phillips curves and unemployment dynamics a critique and a holistic perspective the conventional wisdom that inflation and unemployment are unrelated in the long run implies that these phenomena can be analysed by separate branches of economics the macro literature tries to explain inflation dynamics and estimates the nairu the labour macro literature tries to explain unemployment dynamics and determine the real economic factors that drive the natural rate of unemployment we show that the orthodox view that the new keynesian phillips curve is vertical in the long run and that it cannot generate substantial inflation persistence relies on the implausible assumption of a zero interest rate in the light of these results we argue that a holistic framework is needed to jointly explain the evolution of inflation and unemployment

service innovation embeddedness and business performance evidence from northern ireland this paper explores the factors that determine innovation by service firms and in particular the contribution of intra and extra regional connectivity subsequently it is examined how service firms innovation activity relates to productivity and export behaviour the empirical analysis is based on matched data from the 2005 uk innovation survey the uk component of the 4th community innovation survey cis and the annual business inquiry for northern ireland evidence is found of negative intra regional embeddedness effects but there is a positive contribution to innovation from extra regional connectivity particularly links to customers relationships between innovation exporting and productivity prove complex but suggest that innovation itself is not sufficient to generate productivity improvements only when innovation is combined with increased export activity are productivity gains evident

what do we know about investment under uncertainty recent theoretical developments relating to investment under uncertainty have highlighted the importance of irreversibility for the timing of investment expenditures and their expected returns this has subsequently stimulated a growing empirical literature which examines uncertainty and threshold effects on investment behaviour this paper presents a review of this literature a variety of methods have been used to investigate the empirical implication of irreversibility in investment the majority focusing on the relationship between investment flows and proxy measures of uncertainty a general conclusion is that increased uncertainty at both aggregate and disaggregate levels leads to lower investment rates this suggests that there is an irreversibility effect under which greater uncertainty raises the value of the call option to delay a commitment to investment this effect appears to dominate any positive impact on investment arising from the fact that greater uncertability under certain circumstances increases the marginal profitability of capital the methods used raise a number of issues which call into question the reliability of the findings and these are addressed in the paper however if such irreversibility effects are present then their omission from traditional investment models casts doubt on the efficacy of such specifications jel classification d81 d92 e22

will initiatives to promote hydroelectricity consumption be effective evidence from univariate and panel lm unit root tests with structural breaks abstract this paper examines whether initiatives to promote hydroelectricity consumption are likely to be effective by applying univariate and panel lagrange multiplier lm unit root tests to hydroelectricity consumption in 55 countries over the period 1965 2011 we find that for the panel as well as about four fifths of individual countries that hydroelectricity consumption is stationary this result implies that shocks to hydroelectricity consumption in most countries will only result in temporary deviations from the long run growth path an important consequence of this finding is that initiatives designed to have permanent positive effects on hydroelectricity consumption such as large scale dam construction are unlikely to be effective in increasing the share of hydroelectricity relative to consumption of fossil fuels

openness and innovation home and export demand effects on manufacturing innovation panel data evidence for ireland and switzerland abstract recent studies in the tradition of schmookler have re emphasised the potential role of demand in stimulating innovation here we reconsider the role of home and export market demand in stimulating manufacturing innovation using comparable panel data for two small open economies ireland and switzerland our analysis is based on the estimation of reduced form innovation production functions using panel data estimators over the sample period 1994 2005 for a range of innovation indicators however we find little evidence of any significant market demand effects with innovation performance instead determined largely by firm level capability effects and characteristics in policy and strategy terms this suggests the continued value of measures to improve innovation capability regardless of market demand conditions in more methodological terms our results suggest the validity of the usual assumption implicit in modelling innovation outputs that supply side factors predominate

investigating a neglected part of schumpeter s creative army what drives new to the market innovation in micro enterprises schumpeterian arguments related to creative destruction place small entrepreneurial firms at the centre of the innovation process the exclusion of micro enterprises with less than 10 employees from most innovation surveys means however that we know relatively little about innovation among this group of firms here using new survey data on a thousand micro enterprises we explore the determinants of new to the market innovation the basis for the schumpeterian creative destruction cd process our results provide strong support for the interactive nature of micro enterprise innovation and suggest the potential value of a model of interactive creative destruction icd contrary to some other recent evidence market based and supplier based collaboration both prove important for new to the market innovation our results suggest the importance of micro enterprises as sources of new to the market innovation and the potential value of including such firms in future innovation studies