Article 2020

Employment of R&D personnel after an educational supply shock: Effects of the introduction of Universities of Applied Sciences in Switzerland

Labour Economics
Journal · Vol. 66 · Art. 101883
Abstract

We examine whether firms increase their employment of R&D personnel in response to an expansion of tertiary education institutions, i.e., a supply shock of skilled labor. We use the staggered introduction of Universities of Applied Sciences (UASs) in Switzerland as a quasi-natural experiment to identify causal effects. Firms located near a new UAS campus experience an education-driven labor supply shock in the form of UAS graduates newly entering the local labor market. Using a large representative firm survey and applying a difference-in-differences model, we find that this labor supply shock has positive effects: first, on the percentage of R&D personnel relative to total employment and, second, on the percentage of total wages paid to them. These effects are driven by both very small firms (five to nine employees) and very large ones (5,000 or more). Our findings suggest that a tertiary education expansion can stimulate innovation activities by increasing the personnel resources devoted to R&D. © 2020 Elsevier B.V.

Keywords

Author Keywords

Switzerland Applied research R&D personnel Tertiary education expansion

Index Keywords

Author Affiliations
Department of Business Administration, Universität Zürich, Zurich, ZH, Switzerland
Department of Business Administration, Universität Zürich, Zurich, ZH, Switzerland, Swiss Contractors’ Association, Zurich, Switzerland
Funding & Acknowledgements
Grant: 180096, 511.0-1
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
Grant: 1315000868
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
Grant: 160410, 662.410-1
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
Grant: 160683, 431.10-1
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
Universität Zürich, UZH
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
Staatssekretariat für Bildung, Forschung und Innovation, SBFI
Funding text 1: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21 st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18 th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3 rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).; Funding text 2: The authors would like to thank Eric Bettinger, Bernd Fitzenberger, Dietmar Harhoff, Simon Janssen, Edward Lazear, Jens Mohrenweiser, Samuel Mühlemann, Laura Rosendahl Huber, Guido Schwerdt, Conny Wunsch, seminar participants at the University of Zurich, participants of the 21st Colloquium on Personnel Economics in Munich, participants of the annual meeting of the Bildungsökonomischer Ausschuss des Vereins für Socialpolitik in Bern, participants of the 18th International Labour and Employment Relations Association World Congress in Seoul, participants of the 3rd Centre for Vocational Education Research Conference in London, and participants of the Conference on VET Research in Lausanne for helpful comments. We also thank Natalie Reid for language consulting and the Swiss Federal Statistical Office for data provision of the Swiss Earnings Structure Survey (contract number 160683 Ref. 431.10-1), the Business Census (contract number 180096 Ref. 511.0-1, used in the Online Appendix), and the Survey of Higher Education Graduates (contract number 160410 Ref. 662.410-1, used in the Online Appendix). Furthermore, this paper benefited from very helpful comments by the editor, Michele Pellizzari, and two anonymous reviewers. This study is partly funded by the Swiss State Secretariat for Education, Research and Innovation through its Leading House on the Economics of Education, Firm Behavior and Training Policies (contract number 1315000868).
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