Experience, Innovation and Productivity - Empirical Evidence from Italy's Slowdown



Table 4. OLS Estimates of labor productivity growth rates (in percentage points).

Dependent variable
K
2ln —
2 L
L
it

Any innovation

_______Product_______

_______Process_______

Coefficient

Robust
Std. Err.

Coefficient

Robust
Std. Err.

Coefficient

Robust
Std. Err.

Innovative firms_______

15.12**

7.094

2.588

5.954

-Ш-
17.24

6.006

2 ln K- *Innov

2 L
L
it

0.2587***

0.008

7___⅛⅛⅛

0.292

0.009

7 ~ Ш
0.304

0.009

. K. .

2 ln —— *nonInnov

2 L       ~

Lit

0.01

0.015

0.069

0.011

0.019

0.012

Age* Innov__________

-0.283***

0.069

7__⅝*⅛

-0.286

0.085

7 " _ ⅝*⅛

-0.366

0.078

Age*non Innov______

0.091

0.125

-0.109 .

0.084

0.066

0.091

Temporary *Innov_____

-0.095***

0.035

-0.073*

0.041

7    _ ⅝*⅛

-0.106

0.039

Temporary *non_Innov

-0.199***

0.046

--7—----_ ⅜⅜⅜----

-0.213

0.037

---7______⅜⅜⅜-----

-0.197

0.039

Large_______________

Σ $

-1.94

1.113

-1.894*

1.108

-1.081

1.096

Medium___________

* — ,***

-5.74

0.876

--Σ—_ _-⅜⅜⅜----

-5.965

0.871

________⅜⅜⅜----

-4.970

0.864

Group______________

___⅛⅛⅛

2.86_______

0.680

7   __⅛⅛⅛

3.199

0.679

Z .„***

2.48

0.675

Constant_____________

2.61

10.19

14.019

8.799

3.637

9.216

Industry dummies_____

yes

yes

yes

Region dummies_____

yes

yes

yes

Wald test for equality o:

coefficients '

between Innovative and non Innovative_________________

Capital-lab or ratio

[0.000]

[0.000]

[0.000]

Age______________

[0.0085]

[0.138]

[0.0003]

Share of temporary

[0.069]

[0.011]

[0.0946]

Chow test F__________

[0.000]

[0.000]

[0.000]

Adj R2_______________

0.154

0.157

0.171

N____________

7977

7977

7977

Note: * 10%, ** 5%, *** 1% level of significance, p-values in brackets. Size, areas, industry and group dummies
are included in all regressions.

Table 4 shows the OLS coefficients and robust standard errors of the estimates of labor productivity
growth rates (two-year rates) on our variables of interest, interacted with the group dummies.
“Innov” refers to the group of firms introducing an innovation in 2001-2003, while “non_Innov”
refers to the group of the non innovative firms. Column 1 and 2 refer to firms which have
introduced any - hence either product or process - innovation. Column 3 and 4 refer to firms which
have introduced product innovation only and column 5 and 6 refer to firms having introduced
process innovation only. All the regressions include standard control variables such as size,
geographical areas, industry dummies, as well as the dummy that takes a value of one for firms

17



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