Productivity effects of knowledge transfers through labour mobility

This paper examines whether there are productivity gains due to technology being transmitted across industries through the movement of skilled workers embodying human capital. The empirical analysis is based on household survey and industry-level data for a sample of 12 European Union countries covering the years 1995–2005. The estimates provide evidence of positive cross-sectoral knowledge spillovers and indicate that labour mobility has considerable beneficial effects on industry productivity. The paper further shows that the spillover effects vary considerably by technology level of the giving industry. While workers moving from high-tech and medium-tech industries are found to produce positive productivity effects for the receiving industry, no significant or even negative effects are found for those coming from low-tech industries.