Innovations and Human Capital of Business Owners: Evidence from SIBiL

SIBiL stands for Survey of Innovative Businesses in Latvia, a unique dataset covering 1253 small firms. An important advantage of SIBiL is its compatibility with European Union’s Community Innovations Surveys (CIS) and the section on the personal background of business owners. This paper uses this feature to examine the effects of the owners' human capital on innovations. There are four major findings. First, SIBiL finds substantially greater rates of product innovations as compared with CIS. Second, I find that the level of educational attainment has significant and robust positive effect on innovations. Third, this paper finds that the effect of higher education received after the Soviet era is substantially smaller. Fourth, I find no effects of owners' previous professional background on innovations.