Innovation through New Blood

Published in Annals of Regional Science (2017), open access.


We model the influence of employee mobility on the transmission of knowledge between firms, assuming human capital to be an important influence on service innovation and firm productivity. To this end, we follow individual workers as they move from firm to firm, controlling for knowledge characteristics (‘absorptive capacity’) of the firm and for regional effects (agglomeration and urbanization). We measure the amount and variety of such flows, but find only a small influence on innovativity or productivity of the receiving firm, implying that, contrary to current belief, the impact of tacit knowledge stored in employees on innovation and productivity is negligible.


Innovation, labour mobility, knowledge spillovers, agglomeration externalities


R10, O33, D22

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