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Innovation, Productivity, and Training

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  • Dostie, Benoit

    (HEC Montreal)

Abstract

The firm's stock of human capital is an important determinant of its ability to innovate. As such, any increase in this stock through firm-sponsored training might lead to more innovation. We test this hypothesis using detailed data on firms' human capital investments and innovation performance, the Canadian longitudinal linked employer-employee data from 1999-2006. Our results, with workplace fixed-effects and allowing for time-varying productivity shocks, demonstrate that more training leads to more product and process innovation, with on-the-job training playing a role that is as important as classroom training. We then demonstrate that on-the-job training has a positive impact on firm-level productivity through improved process innovation.

Suggested Citation

  • Dostie, Benoit, 2014. "Innovation, Productivity, and Training," IZA Discussion Papers 8506, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp8506
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    References listed on IDEAS

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    Cited by:

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    2. Megersa Debela Daksa & Molla Alemayehu Yismaw & Sisay Diriba Lemessa & Shemelis Kebede Hundie, 2018. "Enterprise innovation in developing countries: an evidence from Ethiopia," Journal of Innovation and Entrepreneurship, Springer, vol. 7(1), pages 1-19, December.
    3. Yordanos Gebremeskel & Bupe Simuchimba & Chonzi Mulenga, 2019. "Skills Gap, Innovation, and Firms Performance in Zambia," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 11(8), pages 129-129, August.

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    More about this item

    Keywords

    productivity; firm-sponsored training; innovation; linked employer-employee data;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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