The Impact of Regulation on Innovation
1
INSEAD -
Institut Européen d'administration des Affaires
2 LSE - London School of Economics and Political Science
3 PSE - Paris School of Economics
4 PJSE - Paris Jourdan Sciences Economiques
5 Collège de France - Chaire Economie des institutions, de l'innovation et de la croissance
6 HEC Paris - Ecole des Hautes Etudes Commerciales
7 CEPR - Center for Economic Policy Research
2 LSE - London School of Economics and Political Science
3 PSE - Paris School of Economics
4 PJSE - Paris Jourdan Sciences Economiques
5 Collège de France - Chaire Economie des institutions, de l'innovation et de la croissance
6 HEC Paris - Ecole des Hautes Etudes Commerciales
7 CEPR - Center for Economic Policy Research
Résumé
We present a framework that can be used to assess the equilibrium impact of regulation on endogenous innovation with heterogeneous firms. We implement this model using French firm-level panel data, where there is a sharp increase in the burden of labor regulations on companies with 50 or more employees. Consistent with the model’s qualitative predictions, we find a fall in the fraction of innovating firms just to the left of the regulatory threshold. Furthermore, we find a reduction in the innovation response of firms to demand shocks just below the threshold. Regulation reduces aggregate innovation by 5.7 percent.
Domaines
Economies et financesFormat du dépôt | Notice |
---|---|
Type de dépôt | Article dans une revue |
Titre |
en
The Impact of Regulation on Innovation
|
Résumé |
en
We present a framework that can be used to assess the equilibrium impact of regulation on endogenous innovation with heterogeneous firms. We implement this model using French firm-level panel data, where there is a sharp increase in the burden of labor regulations on companies with 50 or more employees. Consistent with the model’s qualitative predictions, we find a fall in the fraction of innovating firms just to the left of the regulatory threshold. Furthermore, we find a reduction in the innovation response of firms to demand shocks just below the threshold. Regulation reduces aggregate innovation by 5.7 percent.
|
Auteur(s) |
Philippe Aghion
1, 2, 3, 4, 5
, Antonin Bergeaud
6, 2, 7
, John van Reenen
2
1
INSEAD -
Institut Européen d'administration des Affaires
( 505124 )
- Bd de Constance, 77305 Fontainebleau
- France
2
LSE -
London School of Economics and Political Science
( 328453 )
- Houghton Street, London WC2A 2AE
- Royaume-Uni
3
PSE -
Paris School of Economics
( 301309 )
- 48 boulevard Jourdan 75014 Paris
- France
4
PJSE -
Paris Jourdan Sciences Economiques
( 578027 )
- 48 boulevard Jourdan 75014 Paris
- France
5
Collège de France - Chaire Economie des institutions, de l'innovation et de la croissance
( 1043633 )
- 11 place Marcelin Berthelot F-75231 Paris Cedex 05
- France
6
HEC Paris -
Ecole des Hautes Etudes Commerciales
( 105633 )
- 1, rue de la Libération - 78351 Jouy en Josas cedex
- France
7
CEPR -
Center for Economic Policy Research
( 143559 )
- Royaume-Uni
|
Langue du document |
Anglais
|
Nom de la revue |
|
Date de publication |
2023-11
|
Volume |
113
|
Numéro |
11
|
Page/Identifiant |
2894-2936
|
Vulgarisation |
Non
|
Comité de lecture |
Oui
|
Audience |
Internationale
|
URL éditeur |
https://www.aeaweb.org/articles/pdf/doi/10.1257/aer.20210107
|
Public visé |
Scientifique
|
Domaine(s) |
|
Mots-clés (JEL) |
|
DOI | 10.1257/aer.20210107 |
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