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

CESifo Working Paper No. 3123

Experience, Innovation and Productivity

Empirical Evidence from Italy’s Slowdown

Abstract

We investigate the role of workers’ and managerial experience as a determinant of firm
innovation and productivity in a sample of Italian manufacturing firms. A high share of
temporary - thus un-experienced - workers is associated to low innovation and productivity.
The effect of managerial experience measured by age on firm performance depends instead on
the type of firm: high age of managers and board members is bad for innovation and
productivity growth, while costs and benefits of old managerial age cancel out for non-
innovative firms.

JEL-Code: M54, O31, D24.

Keywords: firm productivity, innovation, managerial experience, temporary jobs.

Earlier drafts of this paper have been presented at Aix-en-Provence (conference: “Firms,
Trade and Development”), Munich (OECD-CESifo conference “Regulation: Political
Economy, Measurement and Effects on Performance”) and the Istituto Studi per l’Analisi
Economica (ISAE) in Rome. We are grateful to our discussants Remy Lecat and Thomas
Strobel, as well as other conference and seminar participants for their useful comments.

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