Knowledge and Innovation: an Empirical Analysis of Firm 's Organization in the Baltic Countries

The aim of this paper is to investigate the relationship between firm’s innovation and knowledge sources in Baltic countries. We focus on Estonia, Latvia and Lithuania, since for these countries, the relationship between innovation and knowledge is unexplored from an empirical point of view. There is a theoretical background on the different types of knowledge that influence a firm’s innovation level. By using firm-level data of the Community Innovation Survey (CIS 2014), we observe this relationship in the specific sub-category of the manufacturing sector in Baltic countries, and consider a range of control variables. Our findings highlight a positive and consistent relationship between knowledge sources and innovation