The impact of labour relations on innovative output: An exploration of firm-level data in the Netherlands

A growing literature on determinants of innovative performance focuses on factors such as market structure, firm size, (regional and international) knowledge spill-overs, R&D collaboration, conditions for appropriation of innovation benefits, and others. This paper contributes to an aspect that is still sparsely explored: The impact of labour relations and Human Resource Management (HRM) practices on a firm's innovative behaviour. Our empirical findings identify that active HRM policies, including job rotation, performance pay, and high qualification levels of personnel contribute positively to innovative performance.