From a firm’s perspective two competing forces are driving the decision to invest in innovation. On the one hand …, innovative performance is an important driver of profitability and growth. On the other hand, investments in innovation suffer …

Skilled labor is a key input to the innovation process. A shortage in supply of skilled labor may hence impede … innovation activities, resulting in lower productivity gains. While governments are concerned about these likely negative impacts …, there is only limited empirical evidence whether and to what extent labor shortage affects innovation activities. The paper …