Labor Shortage and Innovation

Immigration and the Tech Industry: As a Labor Shortage Remedy, for Innovation or for Cost Savings?

Immigration and the Tech Industry: As a Labor Shortage Remedy, for Innovation, or for Cost Savings?

The two main reasons cited by the U.S. tech industry for hiring foreign workers­­remedying labor shortages and hiring "the best and the brightest"­­are not supported by the data, even after excluding the Indian IT service firms. Instead, the primary goals of employers in hiring the foreign workers are to reduce labor costs and to obtain "indentured" employees. Current immigration policy is caus...

Internal Marketing: An Antidote for Macau's Labor Shortage

Gaming scholars the world over are in consensus about Macau's bright future as a gaming Mecca. The phenomenal growth in gaming facilities over the last three years has created an acute labor shortage in this Special Administrative Region of China. Moreover, around twenty additional gaming and hotel projects have been committed so far, all slated for completion in the next five years. Expansion ...

When Does Labor Scarcity Encourage Innovation?

This paper studies whether labor scarcity encourages technological advances, i.e., technology adoption or innovation, for example, as claimed by Habakkuk in the context of 19th-century United States. I de…ne technology as strongly labor saving if technological advances reduce the marginal product of labor and as strongly labor complementary if they increase it. I show that labor scarcity encour...

When Does Labor Scarcity Encourage Innovation? Strongly Labor Saving Technological Progress

This paper studies the conditions under which the scarcity of a factor (in particular, labor) encourages technological progress and technology adoption. In standard endogenous growth models, which feature a strong scale e¤ect, an increase in the supply of labor encourages technological progress. In contrast, the famous Habakkuk hypothesis in economic history claims that technological progress w...