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The purpose of this paper is to clarify whether the age-productivity curve is different for low-waged and high-waged employees.

Productivity growth is decomposed at the firm level into contributions by hired, separated and staying workers. Based on a matched employer-employee database of Estonian firms from 2006 to 2014 and considering the age as well as wages of employees, a panel data model with fixed effects is constructed to show the relative productivity of each cohort of employees.

High-waged employees appeared to be relatively more productive than low-waged employees and middle-aged were more productive than young or old employees. However, the productivity difference between young and old employees was not statistically significant. The age-productivity curve of high-waged employees appeared to be flatter than that of low-waged employees. Only in knowledge intensive services were the low-waged old employees statistically significantly less productive than high-waged old employees. In the manufacturing industry, the young were more productive than in services, in knowledge intensive services the old were less productive than in traditional services.

The productivity of employees is only analysed for cohorts of employees.

Employers can be encouraged to hire older employees because old employees are shown to remain at least as productive as young employees.

The decomposition of labour productivity at the firm level is further developed, as the statistical difference between the productivity of different groups of employees is analysed.

The aim of this paper is to study the linkages between inward and outward foreign direct investment (FDI) and the innovation inputs and outputs of domestic and foreign owned companies in Estonia, a small economy in CEE.

The econometric analysis of the data about the linkages between FDI and innovation is made using the model by Crépon et al., which allows estimation of the innovation expenditure equation, the knowledge production function (with various innovation output variables as dependent variables) and the productivity equation (production function), with all the equations including company and industry level FDI variables.

The results show that the higher innovation output of foreign owned companies vanishes after various company characteristics are controlled for, but there were significant differences in innovation inputs such as the higher use of knowledge sourcing and the lower importance of various impeding factors. Outward investment has a positive influence on innovativeness among both domestic and foreign owned companies.

The managers can benefit from this study by tapping into a wider range of knowledge sources via diverse and active involvement in exporting and investing activities. Often they fail to realise that initiation of international activities can also serve as an important learning opportunity in becoming more innovative. The policy implications suggest that government policies as well as triple helix cooperation should be oriented not only towards attracting foreign interest, but also towards building opportunities for more extensive regional and international business networking by exporting and outward FDI.

The originality of the study lies in the usage of the data from a small open economy of Central and Eastern Europe. This region is a good candidate for studying the impacts of FDI; while CEE countries were closed to FDI before the onset of transition, since the beginning of transition they have witnessed massive FDI inflows. The present study seems to be one of the first ones to use three different waves of the Community Innovation Survey (CIS), specifically CIS3 covering 1998‐2000, CIS4 (2002‐2004) and CIS2006 (2004‐2006). Thereby the authors are able to study the impact of the changing economic environment on the link between FDI and innovativeness.

The purpose of this paper is to show that the major factors affecting loyalty are dependant on the level of loyalty of customers.

A model of relationship between factors of loyalty and loyalty levels of customers was constructed and tested on the empirical data about 1,000 private customers from the Customer Satisfaction Survey of Elion, the biggest telecommunication company in Estonia. Logit model was used in order to examine which factors influence the probability of the customers remaining on their loyalty level or to moving to another loyalty level.

The findings of the study revealed that it is not accurate to treat all customers equally in terms of methods of increasing their loyalty. The results reveal that four analysed factors affecting customer loyalty (satisfaction, trustworthiness, image and importance of relationship) are playing different roles in the different levels of customer loyalty. The overall satisfaction and importance of a relationship build the foundation of any kind of loyalty. The reliability of products or trustworthiness of the vendor is most critical for behavioural loyalists and the image creation is the main tool for getting committed customers.

The method for collecting the source data set certain constraints on the adequacy of the model.

The results presented in this paper could be used by firms developing targeted approaches as part of the aim of increasing customer's loyalty.

This paper introduces an original approach combining factors affecting the customers' loyalty with the customers' different loyalty levels. Also, the ladder of customer loyalty levels could be used in other research areas.

The purpose of this paper is to demonstrate how technological innovation serves as an enabling factor to innovation in tourism management. The motivation of this paper is related to the question of how to innovate destination marketing as a tool to manage long‐term customer relationships.

The authors use mobile positioning‐based research methods to measure visitors' behaviour. This provides new data for the detection and measurement of destination loyalty that could be used as valuable input to improve destination marketing strategy and develop new services.

The use of mobile positioning helps to improve the quality of data about tourism flows in Estonia. The authors were able to observe and measure the duration, timing, density, seasonality and dynamics of visitations. Further, it allowed also to distinguish repeat visitors. The rich dataset provided by passive mobile positioning (PMP) allowed the implementation of the proposed, more detailed, classification of segments of repeat visitors and the identification of not loyal, somewhat loyal, loyal, very loyal, functionally loyal and forced to be loyal visitors. This analysis made it possible to reveal transit, long‐term, one‐day and other specific visitors among repeat visitors.

The theoretical novelty of the paper consists in the creation of the innovation model of the destination marketing of the country and providing the new approach of segmentation of repeat visitors. Empirical novelty is the use of PMP in studying repeat visitations for destination marketing. The paper offers new ways for governments to shape service policies and allows tourism industry firms to offer new services.

The purpose of this paper is to show how the inward‐outward dynamics in the internationalisation of Baltic banks have led towards higher incorporation into Nordic banking groups and subsequently towards diminishing autonomy.

The paper presents two case studies, which characterise the evolution of international inward‐outward connections in two major Baltic banking groups – Hansabank Group and Skandinaviska Enskilda Banken (SEB) Group.

Acquisitions by Swedish banks in 1998 had a different impact on the internationalisation of the two leading Baltic banking groups. Inward‐outward connections in the case of the Hansabank Group meant that they obtained strong autonomy in controlling Swedbank's activities in the Baltic. In the case of Eesti Ühispank, Latvijas Unibanka and Vilniaus Bankas inward‐outward linkages meant that they lost autonomy about the further expansion to other Baltic countries and were eventually transformed into Baltic subsidiaries of SEB. These differences in strategies between Swedish banks could be explained by the background of the companies (especially their previous internationalisation experience). However, latest developments point towards growing similarities between two groups via incorporation of Hansabank into Swedbank group.

The case study has inherently limited the capacity to offer generalisations concerning other service companies.

These results indicate the inward‐outward development pattern of international service companies. The managers of similar companies can use this development pattern to project the dynamics of market entry strategies.

The paper introduces original experience allocation framework in the context of inward‐outward internationalisation and outlines the dynamic nature of the strategic relations between the foreign owner and its subsidiary.

The purpose of this paper is to map the current situation of entrepreneurship education in higher education institutions (HEIs) of 22 European transition economy countries.

The approach taken was an internet survey and analysis covering 774 HEIs of the region.

In 332 institutions, entrepreneurship‐oriented courses, modules or curricula are offered. Croatia and Slovenia are the leading countries in terms of the coverage of teaching entrepreneurship in universities and colleges, followed by the Baltic countries and the Czech and Slovak Republics. The highest entrepreneurship orientation is found in new and private universities and colleges. In a majority of schools, the theory of entrepreneurship is taught but practice‐oriented training in entrepreneurship is rather limited. The current number of centres of entrepreneurship in the region is small, and the research‐oriented model of entrepreneurship education is used in three to five institutions only.

The paper provides a useful source of information for entrepreneurship education researchers, developers and education policy makers.

The paper maps the HEIs entrepreneurship teaching in post‐communist European countries.

The purpose of this paper is to examine how occupational mobility varies over the business cycle and how selected factors contribute to occupational mobility in different stages of the business cycle.

Using annual micro data from the Estonian Labour Force Survey (2001-2010) and implementing probit models with interaction terms, the paper investigates occupational mobility as a change of occupation in two successive years during recovery, boom and recession periods.

The analysis indicates that occupational mobility is higher during the recovery and boom periods and lower during the recession stage. The demographic characteristics (gender, marital status, knowledge of local language) influence the probability for occupational change during the recovery stage of the business cycle. The position of employees in the occupational hierarchy is significant during the recovery and boom periods. Employees working in the public sector have a lower probability for occupational change compared with private sector employees during the recession. Training has a positive effect on occupational mobility during recession. Tenure reduces the probability of occupational mobility over the whole business cycle.

The paper contributes to the literature by providing new results about the role of different factors of occupational mobility over the business cycle. This is among the few studies addressing the variation in the occupational mobility of employees from the public and private sectors. Interactions between the position of the employees in the occupational hierarchy and the ownership form of their employers and the economic sectors add to the understanding about the mechanism of occupational mobility over the business cycle stages.

Recent economic recession has highlighted the role of labour market flexibility as a key factor of competitiveness of a country. Despite the fact that labour mobility can essentially be seen as part of labour market flexibility, there is notable research gap concerning spatial mobility and other facets of labour market flexibility. The purpose of this special issue is to fill these gaps.

The papers in the special issue represent various quantitative methods and databases, whereas mainly micro data (workplace, labour force or immigrant surveys, job search portal, etc.) is used. However, the type of labour market flexibility addressed is both micro- and macro-level.

It is demonstrated that labour occupational mobility is determined by the business cycle, numerical flexibility, occupational categories, and sector. Spatial mobility may have counterintuitive effects on individual occupational mobility depending on gender and it is related to various flexibilities in the workplace. It is also suggested that different types of flexibilities on a firm level are interdependent of each other.

The special issue adds to the labour market related knowledge by integrating labour market flexibility and mobility. Individually, both phenomena have been studied before, but not much research is devoted to their inter-linkages. The special issue also contributes by examining labour market flexibility and spatial mobility in the context of different countries, economic cycles, and institutional settings.