The dissertation is devoted to the advancement of employee ownership, development of conditions for employee ownership and its use in Latvia. Various types of employee ownership are recognized and used in many countries around the world. Within the framework of this dissertation the author has developed a model of employee ownership which is applicable for circumstances of Latvian entrepreneurship and useful for motivating employees. The developed model has a two-part structure: the necessary legal framework and conditions for the introduction of employee ownership in enterprises. During the research the author explores and critically analyzes existing employee ownership definitions, the theoretical possibilities of application of employee ownership, benefits and risks, experience of other countries. The thesis also identifies the problems related to employee ownership in Latvian companies. Employee ownership model implementation conditions are developed on the basis of the experience of other European Union countries and recommendations of international institutions, as well as the results of empirical studies. Analysis of international experience has a significant role in the development of employee ownership model. The developed employee ownership model has been approved by experts – executives from Latvian large and medium-sized joint-stock companies. The employee ownership model is the first such complex model both in Latvia and the European Union. It can be adapted for use in other European Union countries. The dissertation contains results of research, in which the author has surveyed the employees of large and medium-sized joint-stock companies and found out their opinions about the stock ownership and associated factors. The main results of the study show a positive relationship between employee share ownership and improvement of employee motivation. Employees of Latvian companies have positive attitude towards the acquisition of shares in the company in which they work. This is the first of such kind and scale study in Latvia. The total amount of this dissertation (excluding annexes) is 189 pages. The thesis contains 17 depictions, 15 tables and 14 appendices. The list of literature contains 114 references and sources of information.