Numerical labor flexibility and innovation outcomes of start-up firms: A panel data analysis

Masatoshi Kato* (Corresponding Author), Haibo Shah-Zhou

*Corresponding author for this work

    Research output: Contribution to journalArticleAcademicpeer-review

    10 Citations (Scopus)
    22 Downloads (Pure)

    Abstract

    Using a panel data set based on repeated questionnaire surveys of Japanese start-up firms, this study examines the effects of numerical labor flexibility on the innovation outcomes of start-up firms, a topic on which there is currently insufficient research. Here, numerical labor flexibility is defined as the external labor turnover of regular employees and the proportion of non-regular employees, and innovation outcomes include product innovation and patent applications. The estimation results of a random-effects probit model indicate that an inverted U-shaped relationship exists between the external labor turnover of regular employees and the probability of patent applications. Moreover, a similar U-shaped relationship exists between the proportion of non-regular employees and the probability of product innovation. These results are interpreted in light of the organizational characteristics of start-up firms. The implications of the findings are discussed.

    Original languageEnglish
    Pages (from-to)15-27
    Number of pages13
    JournalTechnovation
    Volume69
    DOIs
    Publication statusPublished - Jan 2018

    Keywords

    • Numerical labor flexibility
    • Panel data
    • Patent applications
    • Product innovation
    • Start-up firm
    • The proportion of non-regular employees
    • External labor turnover of regular employees

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