The effect of learning by hiring on productivity

Authors


  • We thank Tor Eriksson, Lars Geerdsen, Sanne Hiller, Hans Kongsted, Joep Konings, Simone Moriconi, Michael Rosholm, Davide Sala, Valerie Smeets, Mans Soderbom, Stijn Vanormelingen, and Frederic Warzynski (alphabetical order) for helpful suggestions. We also thank the CEBR for the provision of data on Danish patent applications ascribed at the European Patent Office. Parrotta acknowledges financial support from the Graduate School for Integration, Production and Welfare. The usual disclaimer applies.

Abstract

This article focuses on the phenomenon of interfirm labor mobility as a potential channel for knowledge transfer. Using data from the Danish employer-employee register covering the period 1995–2005, we investigate how knowledge carriers—technicians and highly educated workers recruited from a donor firm—contribute to knowledge diffusion and enhanced productivity in the hiring (recipient) firm. Structural estimation of the hiring firms' production functions shows that the impact of the recruitment of knowledge carriers on a firm's value added is an increase of 1%–2%. Several robustness checks confirm this finding.

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