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Innovation and Employment

Process versus Product Innovation

Charles Edquist, Leif Hommen and Maureen McKelvey

Which kinds of growth lead to increased employment and which do not? This is one of the questions that this important volume attempts to answer. The book explores the complex relationships between innovation, growth and employment that are vital for both research into, and policy for, the creation of jobs.
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Appendix B: Organizational innovations

Charles Edquist, Leif Hommen and Maureen McKelvey


Our emphasis in this report on organizational changes as a type of process innovation draws attention to the interdependencies between organizational and technological innovation. It stems from the argument that ‘A theory of technical change which ignores these interdependencies is no more helpful than a theory of economics which ignores the interdependencies of prices and quantities in the world economy’ (Freeman, 1995). The main difficulty involved in incorporating a concept of organizational change into our broader concept of innovation is the problem of doing this in a systematic way, on the basis of well-specified categories that are congruent with the theoretical foundations of the SI approach (Edquist, 1997a: section 2.3.1). This appendix goes beyond our central question of how different types of innovations are related to employment creation and destruction. Despite that, we include it because it introduces some interesting parallels and ways forward for analysing and discussing organizational innovations. It does so by discussing relevant, and partly related, theories in sociology and/or organizational theory that could be useful for analysing organizational innovations within an SI perspective. We include it mainly because of the pressing need for further studies of organizational process innovations and the relation between technological and organizational innovations. Thus the main aim here is to stimulate further research and the formulation of research questions. There is, of course, a very broad and diffuse body of work on organizational change that is situated largely outside of the economics literature, in related fields such as management theory and economic...

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