Effects of R D and Technology Imports on Employment: The Case of Iran

Domestic innovations and technology imports play important roles in boosting relative demand for skilled labor force. These factors are in turn influenced by domestic Ramp;D investments and international trade. Using a translog cost function, this paper studies the effect of technology imports and other factors including output level and physical capital stock on the shares of skilled labor force employment. The data for technology imports are gathered based on ISIC (International Standard Industry Classification) 2digit codes for the period 19712013. Our translog cost function is estimated by seemingly unrelated regressions (SUR) method. The estimation results show that an increase in technology imports raises the share of skilled labor force and decreases the production cost. Moreover, our result indicates that domestic Ramp;D has no effect on employment level of skilled labor force in Iran.