Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/333614 
Year of Publication: 
2025
Series/Report no.: 
IZA Discussion Papers No. 18175
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This study investigates the relationship between Artificial Intelligence (AI) and innovation inputs in Spanish manufacturing firms. While AI is increasingly recognized as a driver of productivity and economic growth, its role in shaping firms' innovation strategies remains underexplored. Using firm-level data, our analysis focuses on whether AI complements innovation inputs - specifically R&D and Embodied Technological Change (ETC) - and whether AI can be considered as a Method of Invention, able to trigger subsequent innovation investments. Results show a positive association between AI adoption and both internal R&D and ETC, in a static and a dynamic framework. Furtheremore, empirical evidence also highlights heterogeneity, with important peculiarities affecting large vs small firms and high-tech vs low-tech companies. These findings suggest that AI may act as both a complement and a catalyst, depending on firm characteristics.
Subjects: 
Artificial Intelligence
method of invention
R&D
innovation inputs
innovative complementarities
JEL: 
O31
O32
Document Type: 
Working Paper

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