FOSTERING INNOVATION THROUGH CREATIVITY STIMULATION METHODS IN CROATIA

Sa？etak The essential prerequisite for an innovation to occur is creativity. Novel ideas, novel solutions of problems are the initial stage of innovation process, but they are also indispensable throughout the innovation process. Innovating firms thus must strive to foster creativity. Literature provides evidence that, apart from personal characteristic of individuals, other factors play important role in unleashing creativity inside firms. Those include, among others, creativity trainings and reward systems designed to encourage creativity of employees. The key question addressed in the paper is whether creativity fostering methods increase innovation output in Croatian firms. By utilizing the Community Innovation Survey 2010 data and propensity score matching methods, we estimate the average treatment effect of the treated (i.e. firms that employ creativity stimulation methods). Within this framework, our measured outcome is the innovation activity of the firm and the treatment is the creativity stimulation method used by the firm