THE INTERACTION BETWEEN HUMAN CAPITAL DEVELOPMENT AND TECHNOLOGICAL CHANGE: EVIDENCE FROM THE WESTERN BALKANS (GDN)

This study addresses the link between technological change in the Western Balkans. It has been found that firms that are subject to technological change have increased demand for skills and a mechanism to accommodate this demand is by providing additional training to their workforce. To test this proposal data were drawn from the European Bank for Reconstruction and Development from the 2002 and 2005 waves. The assessments are used to analyze the impact of technological change on the incidence of training and intensity. The findings of this analysis show that firms undergoing technological change are indeed more likely to provide training, and there is some evidence that they provide a greater intensity of training. This positive link between technological change and training suggests that one way to tackle training for under-investment in the Western Balkans is by increasing incentives for firms to undertake technological change.