I propose a theory of the determinants of organizational innovation which considers it as a device to lower workers' autonomy and their ability to collect information about the production process. In particular, I show that firms may have incentives to increase their control over the workforce to limit spillovers to rivals of potentially valuable information if they cannot limit workers' mobility. I design a theoretical model where firms decide how to organize the workforce to reach a target level of productivity. I assume workers' effort increases production level, but it may reduce workers learning if excessive (due to fatigue), with drawbacks in terms of efficiency. When firms face the threat of information spillovers regarding their secrets, they are keener to intensify control over the workforce. From a policy perspective, I show that banning laws restricting workers' mobility might induce companies to increase management control to limit the amount of knowledge carried by workers. This model applies to the current debate in the US about banning non-compete clauses (NCC) in order to improve competition in the labour market. In this paper, I show that simply promoting labour mobility may be an incomplete policy, as companies would find alternative mechanisms other than legal protections to defend against the appropriation of intellectual property. This is mainly relevant when workers' learning is particularly valuable as it makes production more efficient.
Zoom link: https://uoc-gr.zoom.us/j/97374751400?pwd=UjZ4cUVaSXZ2bnZUT1BNSVhySFlDQT09
