The effects of market economy type on the training practice differences in the Central Eastern European region

Date01 May 2020
Published date01 May 2020
AuthorNemanja Berber,Agnes Slavic,Maja Strugar Jelača,Radmila Bjekić
Subject MatterHR & organizational behaviour,Industrial/labour relations,Employment law
The effects of market economy
type on the training practice
differences in the Central Eastern
European region
Nemanja Berber, Agnes Slavic, Maja Strugar Jela
ca and
Radmila Bjeki
Faculty of Economics, University of Novi Sad, Subotica, Serbia
Purpose The aim of this research is to investigate and detect determinants of the training practice and
conspicuous differences in the sample of nine Central and Eastern European (CEE) countries (Croatia, Estonia,
Latvia, Lithuania, Hungary, Slovenia, Slovakia, Serbia and Romania). The study was conducted with three
distinct objectives: the investigation of the training and development (T&D) practices in the CEE region, the
investigation of the determinants of T&D practices in the CEE region and the measurement of the differences
between the economies in the sample of CEE countries regarding their T&D practices.
Design/methodology/approach The research is based on the Cranet research network results from 2015
to 2016. The data for the CEE countries were selected in order to investigate the determinants of T&D practice,
and the differences between these economies. The nine CEE countries were divided into two groups, on the
basison the variety of capitalism (VoC approach), in order to investigate its effects on the T&D practices. T-test,
chi-square test, Spearman correlation tests and hierarchical moderated regression model were used to test the
proposed hypotheses.
Findings There are statistically significant differences between the organizations from coordinated market
economy (CME) countries and liberal market economy (LME) countriesin the case of the percentage of GDP of
the country spent on education, the percentage of annual payroll costs of the organizations spent on training,
the percentage of annual staff turnover, the implementation of the systematic evaluation of training needs, the
training effectiveness, the existence of T&D strategy and the primary responsibility for major policy decisions
on T&D. The results of the regression model showed that the majority of national and organizational level
factors have a statistically significant relationship with the percentage of the annual payroll costs of the
organization spent on training. Variety of capitalism moderates the relationship between independent
variables and the dependent variable, too.
Research limitations/implications In the presented model, the authors excluded from their investigation
the effects of MNCs. It must further be stated that only the data from the latest Cranet research round were
used, thus it was not possible to investigate the development of the training practice in CEE over a longer time
period. These limitations could be used as possible directions for further research in the relevant area of HRM in
the CEE region.
Originality/value Since there is relatively little empirical research in the relation between capitalism type
and T&D practice, especially in the region of CEE, the present paper lends new insight into this issue as well as
into comparative HRM. It is hoped that this work can be taken as a starting point for further research.
Keywords CEE region, Training practice, Cranet, Market economy type
Paper type Research paper
1. Introduction
This study focuses on the training practice of selected countries in Central and Eastern
Europe. Given that it investigates the differences and similarities of the human resource
management (HRM) practice in various countries, it belongs to the concept of comparative
human resource management (CHRM). Comparative HRM primarily deals with the questions
regarding differences in HRM practices between countries (Brewster, 2007;Po
or et al., 2011;
Brewster and Mayrhofer, 2012;Cooke et al., 2017), because the attitudes towards HRM and its
processes and the way that they are implemented vary from context to context (Brewster and
Effects of
economy type
The current issue and full text archive of this journal is available on Emerald Insight at:
Received 10 October 2018
Revised 22 March 2019
1 August 2019
16 September 2019
6 November 2019
6 February 2020
Accepted 24 March 2020
Employee Relations: The
International Journal
Vol. 42 No. 4, 2020
pp. 971-998
© Emerald Publishing Limited
DOI 10.1108/ER-10-2018-0265
Mayrhofer, 2012). These differences emerge from several national-level factors (cultural
dimensions, legal framework, economic and political context), sector-level (market growth,
environmental concerns and technological changes) and organizational-level factors (size,
technology, ownership and some structural features) (Nikandrou et al., 2008;McNamara
et al., 2012).
In order to compare HRM between countries, one requires, firstly, some or other national
taxonomy (e.g. variety of capitalism or dominant type of national culture) and a set of defining
practices the latter may be comprehensive or simply focusing on a particular area(Cooke
et al., 2017, pp. 198199). According to the above-mentioned factors that distinguish HRM
practices among nations, for the purpose of this paper, the authors set out to investigate a
national-level factor, i.e. the economic context in terms of varieties of capitalism (VoC) with
special emphasis on the coordinated market economies (CME) and liberal market economies
(LME) approach. Although there is a wide range of approaches for defining economic context,
specifically for the CEE region (Maszczyk and Rapacki, 2012;Leszczy
nski, 2015;Farkas,
2017;Wilkinson and Wood, 2017), the authors based their categorization on LME/CME on the
project of Ahlborn et al. (2016), who found that each country in the CEE region shows more or
less similarity with the two main approaches (cluster analysis was used to create clusters in
the CEE region). The authors also include various national-level factors to investigate the
determinants of the T&D practice in the CEE region, such as national expenditures of GDP
spent on education and cultural dimensions (power distance and individualism vs
The differences between LME and CME countries of the CEE region are explored through
the analysis of HRM and one of its main activities, employeesdevelopment. Training and
development (T&D) is conspicuously significant HRM activities, since they are directly
related to the increase and enhancement of employeesknowledge, skills and abilities (KSA)
(Horwitz, 1999;Aguinis and Kraiger, 2009;Qin and Baruch, 2010;Saridakis et al., 2017).
Among the main HRM activities, T&D is of special importance, given that it is positively
related to not only HR activities but organizational outcomes,too (Stavrou, 2005;Shipton et al.,
2006;Hansson, 2007;Morley et al., 2016b;Berber and Lekovi
c, 2018;Dostie, 2018). According
to B
alint and Karoliny (2017), the majority of employees aspire to nurture their skills and
believe that their employer should invest in their training. T&D consistsof several practices
that are presented as training importance (level of training cost, investment), training
effectiveness (estimation of the training needs, training evaluation, creation of trainingon the
basis of appraisal information), training extensiveness(duration of training for special groups
of employees), training techniques, etc. (Po
or et al., 2012;Berber and Slavi
c, 2016).
The goal of this research is to explore and understand the determinants of training
practice and the differentiating features by analysing the sample of the following nine CEE
countries: Croatia, Estonia, Latvia, Lithuania, Hungary, Slovenia, Slovakia, Serbia and
Romania. The work set out to meet the following three objectives: investigate the T&D
practices in the CEE region, explore the determinants of T&D practices in the CEE region and
study the differences between economies in the sample of CEE countries regarding their T&D
The research is based on the Cranet research network results from 2015 to 2016. The
selected data for the CEE countries stemmed from the latest Cranet research round. The nine
CEE countries were categorized into two groups: those that have more characteristics of CME
and those more similar to LME countries (Ahlborn et al., 2016). The underlying reason for
focusing on the CEE region is the continued lack of empirical research in the area of HRM in
these countries (Morley et al., 2016a;Kazlauskaite et al., 2013;Psychogios et al., 2016).
According to Brewster et al. (2010, p. 146), CEE is a region characterized by significant
structural/institutional and configuration differences, along with significant practice
differences in HRM, compared with other regions and territories.

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