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Training and Innovation

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  • Stefan Bauernschuster
  • Oliver Falck
  • Stephan Heblich

Abstract

Research analyzing the importance of human capital for innovation usually focuses on secondary and tertiary education. This paper takes a different perspective by focusing on in-firm training. We argue that continuous training guarantees access to leading-edge knowledge and thus increases a firm's propensity to innovate. Using German establishment-level data, we show a strong association between lagged continuous training and innovation. Applying instrumental variable methods, we cautiously argue that the association between training and innovation is indeed a causal effect. In the quest for a relevant and valid instrument, we exploit legal regulations of the German Works Constitution Act. (c) 2009 by The University of Chicago. All rights reserved.

Suggested Citation

  • Stefan Bauernschuster & Oliver Falck & Stephan Heblich, 2009. "Training and Innovation," Journal of Human Capital, University of Chicago Press, vol. 3(4), pages 323-353.
    • Handle: RePEc:ucp:jhucap:v:3:y:2009:i:4:p:323-353
    DOI: 10.1086/653713
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