The Political Economy of Skilled Workers and Innovation

Cynthia Bansak, Keith A Bender, Michael Coon

Research output: Chapter in Book/Report/Conference proceedingChapter


This chapter examines the link between skilled workers and innovation, and the
political economy that affects this relationship. With a focus on the current state
of research in this area, the chapter first summarizes the new evidence on the
connections between skilled labor and innovation relating to knowledge development, entrepreneurship, teams, diversity, and brain drain. The second section discusses the possibility for reverse causality – namely, that innovation can be a driver of the demand for high-skilled labor. In the following section, connections are made between public policies related to education systems, immigration, patent systems, intellectual property, public–private partnerships and amenities, and the possible effect on the level of skilled workers in various labor markets. The recent research is largely focused on the USA and OECD countries, and empirical evidence is provided using current data that corroborates the results of many of the reviewed studies. The final section lists resources for researchers aiming to move forward on the frontier of this line of research.
Original languageEnglish
Title of host publicationHandbook of Labor, Human Resources and Population Economics
EditorsKlaus F. Zimmermann
Place of PublicationCham
Number of pages33
ISBN (Electronic)978-3-319-57365-6
Publication statusE-pub ahead of print - 17 Dec 2021

Bibliographical note

The article has benefitted from valuable comments from the editors and anonymous referees and the research assistance of Norbert Oros and Sahil Lalwani. We also would like to thank our families and colleagues, particularly Sahar Milani, for their support as we worked on this chapter during these challenging times. We did not receive financial support and there is no conflict of interest.


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