IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v15y2023i10p8180-d1149551.html
   My bibliography  Save this article

Sustainable Enterprise Development in the Manufacturing Sector: Flexible Employment and Innovation in China

Author

Listed:
  • Chengde You

    (School of Business Administration, Jimei University, Xiamen 361021, China)

  • Huishan Qiu

    (School of Business Administration, Jimei University, Xiamen 361021, China)

  • Zhuojie Pi

    (School of Business Administration, Jimei University, Xiamen 361021, China)

  • Mengyuan Yu

    (School of Business Administration, Jimei University, Xiamen 361021, China)

Abstract

Since the COVID-19 outbreak, the scope and market size of flexible employment in sustainable enterprise development have significantly increased worldwide, yet academic literature offer little information about the outcomes and moderators of flexible employment in China. The paper advances current knowledge and empirically addresses this gap by examining the effects of flexible employment on enterprise innovation input and output, with information technology capability and labor regulation as unexplored moderators. Based on data from 1179 manufacturing enterprises in China, this paper uses the OLS method to conduct empirical tests. The results show that (1) flexible employment has positively contributed to sustainable enterprise development by facilitating innovation inputs and outputs; (2) superior enterprise information technology capabilities and strict labor regulations were significant moderating factors in this relationship. The findings provide credible evidence for enterprises to pursue flexible employment as an inexhaustible impetus for sustainable economic and enterprise development.

Suggested Citation

  • Chengde You & Huishan Qiu & Zhuojie Pi & Mengyuan Yu, 2023. "Sustainable Enterprise Development in the Manufacturing Sector: Flexible Employment and Innovation in China," Sustainability, MDPI, vol. 15(10), pages 1-30, May.
  • Handle: RePEc:gam:jsusta:v:15:y:2023:i:10:p:8180-:d:1149551
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/15/10/8180/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/15/10/8180/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gavin Murphy & Iulia Siedschlag & John McQuinn, 2017. "Employment protection and industry innovation," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 26(3), pages 379-398.
    2. Haibo Zhou & Ronald Dekker & Alfred Kleinknecht, 2011. "Flexible labor and innovation performance: evidence from longitudinal firm-level data," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 20(3), pages 941-968, June.
    3. Alfred Kleinknecht & Flore N. van Schaik & Haibo Zhou, 2014. "Is flexible labour good for innovation? Evidence from firm-level data," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 38(5), pages 1207-1219.
    4. van Ours, Jan C. & Boone, Jan & Belot, Michèle, 2002. "Welfare Effects of Employment Protection," CEPR Discussion Papers 3396, C.E.P.R. Discussion Papers.
    5. Thomas Hempell & Thomas Zwick, 2008. "New Technology, Work Organisation, And Innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 17(4), pages 331-354.
    6. Scarpetta, Stefano & Tressel, Thierry, 2004. "Boosting productivity via innovation and adoption of new technologies : any role for labor market institutions?," Policy Research Working Paper Series 3273, The World Bank.
    7. Lorenz, Edward, 1999. "Trust, Contract and Economic Cooperation," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 23(3), pages 301-315, May.
    8. Caroli, Eve, 2007. "Internal Versus External Labour Flexibility: The Role of Knowledge Codification," National Institute Economic Review, National Institute of Economic and Social Research, vol. 201, pages 107-118, July.
    9. Andrea Bassanini & Ekkehard Ernst, 2002. "Labour market regulation, industrial relations and technological regimes: a tale of comparative advantage," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 11(3), pages 391-426, June.
    10. Wachsen, Eva & Blind, Knut, 2016. "More labour market flexibility for more innovation? Evidence from employer–employee linked micro data," Research Policy, Elsevier, vol. 45(5), pages 941-950.
    11. Bastgen, A. & Holzner, C. L., 2017. "Employment protection and the market for innovations," Munich Reprints in Economics 49925, University of Munich, Department of Economics.
    12. Giorgio Calcagnini & Germana Giombini & Giuseppe Travaglini, 2018. "A Schumpeterian model of investment and innovation with labor market regulation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 27(7), pages 628-651, October.
    13. Xiang, Dong & Chen, Jiakui & Tripe, David & Zhang, Ning, 2019. "Family firms, sustainable innovation and financing cost: Evidence from Chinese hi-tech small and medium-sized enterprises," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 499-511.
    14. Timothy Besley & Robin Burgess, 2004. "Can Labor Regulation Hinder Economic Performance? Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 91-134.
    15. Shilei Hu & Xiaohong Wang & Marcelo A. Savi, 2021. "IT Usage and Innovation Performance of SMEs in China: A New Perspective," Discrete Dynamics in Nature and Society, Hindawi, vol. 2021, pages 1-12, October.
    16. Lawrence M. Kahn, 2012. "Labor market policy: A comparative view on the costs and benefits of labor market flexibility," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 31(1), pages 94-110, December.
    17. Alfred Kleinknecht & Zenlin Kwee & Lilyana Budyanto, 2016. "Rigidities through flexibility: flexible labour and the rise of management bureaucracies," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 40(4), pages 1137-1147.
    18. Frank Crowley & Jane Bourke, 2017. "The Influence Of Human Resource Management Systems On Innovation: Evidence From Irish Manufacturing And Service Firms," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 21(01), pages 1-28, January.
    19. Hoxha, Sergei & Kleinknecht, Alfred, 2020. "When labour market rigidities are useful for innovation. Evidence from German IAB firm-level data," Research Policy, Elsevier, vol. 49(7).
    20. Jelena Reljic & Armanda Cetrulo & Valeria Cirillo & Andrea Coveri, 2023. "Non-standard work and innovation: evidence from European industries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 32(1), pages 136-164, January.
    21. Spyros Arvanitis, 2005. "Modes of labor flexibility at firm level: Are there any implications for performance and innovation? Evidence for the Swiss economy," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 14(6), pages 993-1016, December.
    22. Andrea Bassanini & Ekkehard Ernst, 2002. "Labour Market Institutions, Product Market Regulation, and Innovation: Cross-Country Evidence," OECD Economics Department Working Papers 316, OECD Publishing.
    23. Armanda Cetrulo & Valeria Cirillo & Dario Guarascio, 2019. "Weaker jobs, weaker innovation. Exploring the effects of temporary employment on new products," Applied Economics, Taylor & Francis Journals, vol. 51(59), pages 6350-6375, December.
    24. García-Vega, María & Kneller, Richard & Stiebale, Joel, 2021. "Labor market reform and innovation: Evidence from Spain," Research Policy, Elsevier, vol. 50(5).
    25. Elke J. Jahn & Regina T. Riphahn & Claus Schnabel, 2012. "Feature: Flexible Forms of Employment: Boon and Bane," Economic Journal, Royal Economic Society, vol. 122(562), pages 115-124, August.
    26. Landon Kleis & Paul Chwelos & Ronald V. Ramirez & Iain Cockburn, 2012. "Information Technology and Intangible Output: The Impact of IT Investment on Innovation Productivity," Information Systems Research, INFORMS, vol. 23(1), pages 42-59, March.
    27. Barasa, Laura & Knoben, Joris & Vermeulen, Patrick & Kimuyu, Peter & Kinyanjui, Bethuel, 2017. "Institutions, resources and innovation in East Africa: A firm level approach," Research Policy, Elsevier, vol. 46(1), pages 280-291.
    28. Michie, Jonathan & Sheehan, Maura, 1999. "HRM Practices, R&D Expenditure and Innovative Investment: Evidence from the UK's 1990 Workplace Industrial Relations Survey (WIRS)," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 8(2), pages 211-234, June.
    29. Eve Caroli, 2007. "Internal versus external labour Flexibility," National Institute Economic Review, National Institute of Economic and Social Research, vol. 201(1), pages 107-118, July.
    30. Chatterjee, Sheshadri & Chaudhuri, Ranjan & Vrontis, Demetris, 2022. "Does remote work flexibility enhance organization performance? Moderating role of organization policy and top management support," Journal of Business Research, Elsevier, vol. 139(C), pages 1501-1512.
    31. Bastgen, A. & Holzner, C.L., 2017. "Employment protection and the market for innovations," Labour Economics, Elsevier, vol. 46(C), pages 77-93.
    32. Sulistiyo K. Ardiyono & Arianto A. Patunru, 2022. "The impact of employment protection on FDI at different stages of economic development," The World Economy, Wiley Blackwell, vol. 45(12), pages 3679-3714, December.
    33. Amaia Altuzarra & Felipe Serrano, 2010. "Firms' Innovation Activity and Numerical Flexibility," ILR Review, Cornell University, ILR School, vol. 63(2), pages 327-339, January.
    34. Belot, Michèle & Boone, Jan & van Ours, Jan C, 2002. "Welfare Effects of Employment Protection," CEPR Discussion Papers 3396, C.E.P.R. Discussion Papers.
    35. Chaurey, Ritam, 2015. "Labor regulations and contract labor use: Evidence from Indian firms," Journal of Development Economics, Elsevier, vol. 114(C), pages 224-232.
    36. Francis, Bill B. & Kim, Incheol & Wang, Bin & Zhang, Zhengyi, 2018. "Labor law and innovation revisited," Journal of Banking & Finance, Elsevier, vol. 94(C), pages 1-15.
    37. Kato, Masatoshi & Zhou, Haibo, 2018. "Numerical labor flexibility and innovation outcomes of start-up firms: A panel data analysis," Technovation, Elsevier, vol. 69(C), pages 15-27.
    38. Feipeng Feng, 2019. "Does Industrial Policy Play an Important Role in Enterprise Innovation?," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 55(15), pages 3490-3512, December.
    39. Facang Zhu & Qianqian Li & Shichun Yang & Tomas Balezentis, 2021. "How ICT and R&D affect productivity? Firm level evidence for China," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 34(1), pages 3468-3486, January.
    40. Nesheim, Torstein, 2003. "Using External Work Arrangements in Core Value-creation Areas," European Management Journal, Elsevier, vol. 21(4), pages 528-537, August.
    41. Meyer, Moritz & Vandenberg, Paul, 2013. "Globalization, Labor Market Regulation, and Firm Behavior," ADB Economics Working Paper Series 361, Asian Development Bank.
    42. repec:ilo:ilowps:994908893402676 is not listed on IDEAS
    43. Angel Martínez‐Sánchez & María José Vela‐Jiménez & Manuela Pérez‐Pérez & Pilar de Luis‐Carnicer, 2009. "Innovation and labour flexibility," International Journal of Manpower, Emerald Group Publishing Limited, vol. 30(4), pages 360-376, July.
    44. Ritter-Hayashi, Daniela & Knoben, Joris & Vermeulen, Patrick A.M., 2021. "Temporary employment: Curse or blessing for a firm's absorptive capacity?," Technological Forecasting and Social Change, Elsevier, vol. 173(C).
    45. repec:dau:papers:123456789/7247 is not listed on IDEAS
    46. Casey Ichniowski & Kathryn Shaw, 1995. "Old Dogs and New Tricks: Determinants of the Adoption of Productivity-Enhancing Work Practices," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995 Micr), pages 1-65.
    47. Francesco Franceschi & Vincenzo Mariani, 2016. "Flexible labor and innovation in the Italian industrial sector," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 25(4), pages 633-648.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Olga V. Budzinskaya & Natalya M. Fomenko & Natalia N. Chubaeva, 2024. "Change Management of Population’s Employment in Information Society 5.0: SAP–LAP Model for Sustainable Development," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 25(1), pages 139-154, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dughera, Stefano & Quatraro,Francesco & Ricci,Andrea & Vittori,Claudia, 2021. "For the rest of our lives: Flexibility and innovation in Italy," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 202102, University of Turin.
    2. Alfred Kleinknecht, 2017. "Supply-side labour market reforms: a neglected cause of the productivity crisis," Working Papers 0027, ASTRIL - Associazione Studi e Ricerche Interdisciplinari sul Lavoro.
    3. Kato, Masatoshi & Zhou, Haibo, 2018. "Numerical labor flexibility and innovation outcomes of start-up firms: A panel data analysis," Technovation, Elsevier, vol. 69(C), pages 15-27.
    4. Hoxha, Sergei & Kleinknecht, Alfred, 2020. "When labour market rigidities are useful for innovation. Evidence from German IAB firm-level data," Research Policy, Elsevier, vol. 49(7).
    5. Wachsen, Eva & Blind, Knut, 2016. "More labour market flexibility for more innovation? Evidence from employer–employee linked micro data," Research Policy, Elsevier, vol. 45(5), pages 941-950.
    6. Armanda Cetrulo & Dario Guarascio, 2018. "Weaker Jobs, Weaker Innovation. Exploring The Temporary Employment-Product Innovation Nexus," Working Papers 0032, ASTRIL - Associazione Studi e Ricerche Interdisciplinari sul Lavoro.
    7. Robert Vergeer & Steven Dhondt & Alfred Kleinknecht & Karolus Kraan, 2015. "Will ‘structural reforms’ of labour markets reduce productivity growth? A firm-level investigation," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 12(3), pages 300—317-3, December.
    8. Michele Capriati & Valeria Cirillo & Marialuisa Divella, 2024. "Productivity slowdown across European regions: does non-standard work matter?," Regional Studies, Taylor & Francis Journals, vol. 58(9), pages 1687-1709, September.
    9. Robert VERGEER & Alfred KLEINKNECHT, 2014. "Do labour market reforms reduce labour productivity growth? A panel data analysis of 20 OECD countries (1960–2004)," International Labour Review, International Labour Organization, vol. 153(3), pages 365-393, September.
    10. Larisa Smirnykh, 2016. "Is Flexible Labor Good for Innovation? Evidence from Russian Firm-level Data," Foresight and STI Governance (Foresight-Russia till No. 3/2015), National Research University Higher School of Economics, vol. 10(4), pages 60-70.
    11. repec:aia:aiaswp:wp115 is not listed on IDEAS
    12. Colombelli, Alessandra & Grilli, Luca & Minola, Tommaso & Mrkajic, Boris, 2020. "To what extent do young innovative companies take advantage of policy support to enact innovation appropriation mechanisms?," Research Policy, Elsevier, vol. 49(10).
    13. Alfred Kleinknecht, 2014. "Schaden Strukturreformen des Arbeitsmarkts der Innovation?," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 40(3), pages 417-428.
    14. Chih-Hai Yang, 2023. "R&D responses to labor cost shock in China: does firm size matter?," Small Business Economics, Springer, vol. 61(4), pages 1773-1793, December.
    15. Tan, Youchao & Liu, Xiumei & Sun, Hanwen & Zeng, Cheng(Colin), 2022. "Population ageing, labour market rigidity and corporate innovation: Evidence from China," Research Policy, Elsevier, vol. 51(2).
    16. Sergei Hoxha & Alfred Kleinknecht, 2024. "When structural reforms of labor markets harm productivity. Evidence from the German IAB panel," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 33(3), pages 541-554.
    17. Valeria Cirillo & Andrea Ricci, 2022. "Heterogeneity matters: temporary employment, productivity and wages in Italian firms," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 39(2), pages 567-593, July.
    18. Spyros Arvanitis & Florian Seliger & Tobias Stucki, 2013. "The Relative Importance of Human Resource Management Practices for a Firm's Innovation Performance," KOF Working papers 13-341, KOF Swiss Economic Institute, ETH Zurich.
    19. Nicole Torka & Jan Kees Looise & Stefan Zagelmeyer, 2011. "Ordinary Atypical Workers, Participation within the Firm and Innovation: A Theoretical Endeavor and Empirical Outlook," management revue - Socio-Economic Studies, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 22(3), pages 221-239.
    20. Luca Cattani & Stefano Dughera & Fabio Landini, 2023. "Interlocking complementarities between job design and labour contracts," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 9(2), pages 501-528, July.
    21. Grassi, Emanuele & Di Cintio, Marco, 2012. "Uncertainty, flexible labour relations and R&D expenditure," MPRA Paper 37646, University Library of Munich, Germany.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:15:y:2023:i:10:p:8180-:d:1149551. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.