The location of innovative activity in Europe

In this paper we use new data to describe how firms from 15 European countries organise their innovative activities. The data matches firm level accounting data with information on the patents that those firms and their subsidiaries have applied for at the European Patents Office. We describe the data in detail.International investment and multinational firms; technological change and research and development; fiscal policies and behaviour of economic agents

Employment Protection Legislation, Multinational Firms and Innovation

The theoretical effects of labour regulations such as employment protection legislation (EPL) on innovation is ambiguous, and empirical evidence has thus far been inconclusive. EPL increases job security and the greater enforceability of job contracts may increase worker investment in innovative activity. On the other hand EPL increases adjustment costs faced by firms, and this may lead to under-investment in activities that are likely to require adjustment, including technologically advanced innovation. In this paper we find empirical evidence that both effects are at work - multinational enterprises locate more innovative activity in countries with high EPL, however they locate more technologically advanced innovation in countries with low EPL.employment protection; Innovation; multinational firm location

Replication data for: Employment Protection Legislation, Multinational Firms and Innovation

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Product market reforms, labour market institutions and unemployment

We analyze the impact of product market competition on unemployment and wages, and howthis depends on labour market institutions. We use differential changes in regulations acrossOECD countries over the 1980s and 1990s to identify the effects of competition. We find thatincreased product market competition reduces unemployment, and that it does so more incountries with labour market institutions that increase worker bargaining power. The theoreticalintuition is that both firms with market power and unions with bargaining power are constrainedin their behaviour by the elasticity of demand in the product market. We also find that the effectof increased competition on real wages is beneficial to workers, but less so when they have highbargaining power. Intuitively, real wages increase through a drop in the general price level, butworkers with bargaining power lose out somewhat from a reduction in the rents that they hadpreviously captured. We analyze the impact of product market competition on unemployment and wages, and howthis depends on labour market institutions. We use differential changes in regulations acrossOECD countries over the 1980s and 1990s to identify the effects of competition. We find thatincreased product market competition reduces unemployment, and that it does so more incountries with labour market institutions that increase worker bargaining power. The theoreticalintuition is that both firms with market power and unions with bargaining power are constrainedin their behaviour by the elasticity of demand in the product market. We also find that the effectof increased competition on real wages is beneficial to workers, but less so when they have highbargaining power. Intuitively, real wages increase through a drop in the general price level, butworkers with bargaining power lose out somewhat from a reduction in the rents that they hadpreviously captured

OECD countries, profitability, unemployment and regulations

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