Impact of innovation on employment: A review of literature

The primary objective of this study is to assess the significance of the knowledge diffusion process in relation to the employment outcomes resulting from sustainable development investments made by major multinational corporations. To gauge the degree of technological interconnectedness among these companies, we employ a measure derived from the distribution of environmentally friendly patents. Within this analytical framework, we aim to decipher the multifaceted factors influencing labor innovation outcomes, which encompass both the displacement of jobs and the compensation effects stemming from innovation. This study delves into two primary research inquiries. Firstly, we examine whether investments in the green economy stimulate job creation at the firm level, specifically within three distinct environmental domains: water, waste, and energy. Secondly, we seek to understand the extent to which the diffusion of knowledge plays a pivotal role in supporting labor within an environmental context. This is achieved by scrutinizing the impact of intra-industry externalities. The research emphasizes the need not only for economic incentives to facilitate the transition to cleaner technologies but also for more robust measures aimed at promoting job generation within the environmental sector. This dual approach is essential for realizing a fully sustainable paradigm within these corporations.