Uncertainty, flexible labour relations and R&D expenditure

descriptionPublicationkeyboard_double_arrow_right Research , Preprint , Report 26 Mar 2012 Germany English Publisher:Brussels: Economics and Econometrics Research Institute (EERI)

Authors: Grassi, Emanuele; Di Cintio, Marco;

handle: 10419/142663

Uncertainty, flexible labour relations and R&D expenditure

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Abstract

This paper examines the effects of uncertainty and flexible labour contracts on the Research and Development (R&D) expenditure. Using a panel of Italian manufacturing firms, we find a hump-shaped relationship between workforce flexibility and R&D outlays. Moreover, as predicted by the real options theory, our results suggest that product market uncertainty reduces R&D efforts and that flexible labour contracts countervail the adverse effect of uncertainty on R&D.

Country

Germany

Related Organizations

Ludwig-Maximilians-Universität München
Germany

Keywords

D81 - Criteria for Decision-Making under Risk and Uncertainty, O31, Real options theory, R&D, uncertainty, temporary workers, R&D, ddc:330, Real options theory, R&D, uncertainty, temporary workers., Real options theory, temporary workers, D81, real options theory, R&D, uncertainty, temporary workers, D21 - Firm Behavior: Theory, J41, uncertainty, O31 - Innovation and Invention: Processes and Incentives, D22, jel: jel:D81, jel: jel:D22, jel: jel:D21, jel: jel:J41, jel: jel:O31

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