Does training explain innovation in transition economies?

This study investigates the impact of training programs on innovation for firms in transition economies. We exploit data from the World Bank Enterprise Surveys across 27 countries in Eastern Europe and Central Asia. Results, emerging from several specifications of bivariate probit models, show that: (i) communication training significantly enhances product and process innovation and (ii) on-the-job training proves to be more effective than in-class training to foster innovation. The key role of on-the-job training is even more pronounced focusing on manufacturing sector and at geographical level. These results may favour the attention of policymakers and firms in transition countries to invest in specific training programs to catch-up the innovation standards of developed economies.