Scientific Personnel Allocation and Firm Innovation: Evidence from China's Expansion of Higher Education
51 Pages Posted: 23 Oct 2014
Date Written: October 23, 2014
Scientific personnel are important to firm innovation; however, their short-run supply is inelastic. During China’s college enrollment expansion beginning in 1999, colleges had hired a larger proportion of scientific personnel than before, thereby making fewer available to industries. We empirically confirm that the increase in the number of college teachers resulted in lower innovation propensities among firms in China. College expansion also imposed a negative effect on total patenting. Moreover, in areas where college expansion was more intensive, highly educated individuals were less likely to choose industrial jobs, and the wage gap between professional jobs and non-professional jobs was higher.
Keywords: College expansion; scientific personnel; Firm innovation; Patenting; China
JEL Classification: O30, J20
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