Short-term labour mobility drives innovation in Africa

A growing body of research highlights the importance of mobility in the global knowledge economy, but has largely focused on high-income countries. This column addresses the crucial role of international labour mobility in fostering innovation in Africa, demonstrating that short-term visits, especially for business or professional purposes, significantly increase the likelihood of firms innovating in both products and services. The effect is particularly pronounced in African countries compared to the rest of the world, where the link between mobility and innovation is weaker. The findings suggest that Africa can leverage mobility to enhance its innovation capacity and foster economic growth.

In recent years, the African continent has been grappling with several critical policy debates around fostering innovation and economic growth. One such debate is the role of labour mobility in driving productivity and innovation, particularly in the context of low- and medium-income economies. A growing body of research highlights the importance of mobility in the global knowledge economy, with studies showing that the movement of people across borders can stimulate the exchange of ideas, skills, and technologies (Bahar et al., 2020). However, much of this literature has focused on high-income countries, leaving a gap in understanding the effects of short-term mobility on innovation in Africa.

In this column, I draw on research, conducted with Assi Okara and Massimiliano Tani, to show how short-term international mobility – especially for business and professional visits – has a unique and significant impact on innovation in African firms (Mbaye et al. 2024). We demonstrate that mobility, even on a short-term basis, is a powerful driver of innovation in products and services, particularly in comparison with the rest of the world.

Short-term labour mobility and innovation in Africa

Our findings reveal that short-term international mobility – defined here as visits lasting less than a year – has a notable and positive effect on innovation, particularly in African countries. While labour mobility is widely recognised as a driver of innovation in high-tech industries in advanced economies (Bahar and Rapoport 2018), our research suggests that in Africa, the effect is strongest in sectors where innovation is more related to product and service development rather than process innovation.

A 10% increase in short-term mobility per 10,000 inhabitants raises the probability of innovation by 0.43%. More importantly, this effect is stronger in Africa than in other regions of the world. When we examine the interaction between short-term mobility and innovation in African countries, we find that mobility significantly increases the likelihood of innovation in both products and services, particularly in low-technology sectors. The importance of these findings lies in the fact that innovation in African countries has historically been hampered by a lack of technological infrastructure and investment. Short-term mobility appears to be an effective mechanism for bridging this gap, allowing firms to access new ideas and expertise from outside their local environments.

Business visits: A key driver of innovation

Not all types of short-term mobility have the same impact on innovation. Our first measure of short-term mobility captures arrivals for different purposes, such as business visits, leisure travel, and professional exchanges. When we focus exclusively on business visits, we find that they have a particularly strong impact on the likelihood of African firms innovating.

Put differently, we find even stronger evidence that African firms are more likely to innovate than firms in other parts of the world as business visits increase. This is because business visits often involve direct interaction with firms, facilitating the exchange of knowledge, technology, and practices that can directly enhance firms’ innovation capabilities. The significance of this finding cannot be overstated. Short-term business visits allow African firms to integrate into global value chains, gain exposure to cutting-edge technologies, and adopt best practices from more developed economies. These exchanges, though difficult to quantify, represent a crucial form of knowledge transfer that supports innovation and growth in African countries.

Our results align with previous research on the role of business visits in stimulating innovation. For instance, a study by D’Este and Patel (2007) found that university researchers that engage in international collaborations – whether through meetings and conferences, joint research, or other forms of mobility – are more likely to introduce new products and processes. In our context, business visits offer African firms the opportunity to tap into global networks of knowledge and expertise, thus accelerating their innovation capacity.

Policy implications: Leveraging short-term mobility for innovation

Our findings have important policy implications for African countries looking to promote innovation and economic development. First and foremost, the positive relationship between short-term mobility and innovation suggests that policymakers should prioritise facilitating the movement of people across borders. This could be achieved through a range of measures aimed at improving access to international markets, fostering collaboration, and promoting knowledge exchange:

• Promote regional mobility within Africa: African countries should implement and strengthen the Free Movement Protocols of the African Union, which would allow for the free movement of skilled professionals, entrepreneurs, and innovators across the continent. This would not only promote intra-Africa trade but also facilitate knowledge transfer within the region, enhancing innovation capacity across African economies.
• Leverage the African Continental Free Trade Area (AfCFTA): The AfCFTA could be a game-changer for Africa by encouraging the free movement of people and services. This would allow African firms to engage more directly with global supply chains, attract foreign expertise, and enhance their innovation capabilities. By promoting mobility through the AfCFTA, Africa can foster a more dynamic and competitive business environment.
• Attract business and professional visits: African policymakers should focus on attracting short-term business visits by making it easier for international entrepreneurs and professionals to visit Africa. Simplifying visa procedures, establishing innovation hubs, and hosting international business events and conferences could help African firms gain exposure to global best practices and cutting-edge technologies.
• Encourage mobility from technologically advanced countries: Our research suggests that the origin of short-term visitors plays a key role in the innovation outcomes of the receiving country.
  
  Therefore, policymakers should focus on initiatives that encourage mobility from technologically advanced countries. This could involve creating partnerships with top innovating nations, facilitating knowledge exchange programmes, and encouraging temporary assignments in high-tech sectors. This is also an opportunity to leverage the knowledge and expertise of the African Diaspora living in advanced countries.
• Invest in data collection and knowledge sharing: To fully realise the benefits of short-term labour mobility, African countries should invest in better data collection on the flows of people across borders. This would help policymakers understand the specific types of mobility that have the greatest impact on innovation and adjust their policies accordingly. Moreover, fostering platforms for knowledge sharing – whether through virtual networks or physical collaboration hubs – could further amplify the impact of labour mobility on innovation.

Conclusion

In conclusion, short-term labour mobility – especially in the form of business and professional visits – emerges as a key driver of innovation in Africa. Our research highlights the positive and higher impact that mobility has on innovation in African countries compared to the rest of the world. By leveraging mobility, African countries can tap into global knowledge networks, foster innovation, and boost their economic growth prospects.

Policymakers should recognise the value of short-term mobility as a tool for enhancing innovation capacity and design policies that facilitate the free movement of people, particularly skilled workers and entrepreneurs. In doing so, they can help unlock new opportunities for innovation, productivity growth, and economic development across the continent. As Africa continues to face numerous challenges in terms of technological development and industrialisation, short-term labour mobility could prove to be a vital lever for progress.

Source: cepr.org