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Open labour markets are often seen as a precondition for innovation, particularly for new industries. However, this view ignores two core findings of the economic systems literature: first, that mobility patterns are institutional microsystems that need to be complementary to other institutions in the labour market; and second, that new industries may be characterised by incremental and complex innovation. Based on these considerations, we ask how mobility affects innovation in the video games industry in the US and Japan. We find that inter-firm mobility is beneficial for innovation in the US, but has negative effects in Japan. We further find that inter-functional mobility is beneficial for innovation in both countries. Our analysis is based on career histories from the video games industry in the US and Japan. We present an empirical study based on the game development of 815 video games and the careers of 28,426 video game developers who were involved in the development of games released between 1999 and 2009.
