The role of size in firms' training: evidence from Spain

Purpose – The purpose of this paper is to analyse why small firms provide less training to their employees than their larger counterparts. The hypothesis is that large firms are endowed with certain firm characteristics that require more training and with some that allow them to obtain larger returns from this investment. Design/methodology/approach – The paper analyses the individual contribution of these characteristics to explain the gap between small and large firms in the probability of providing training and its extent using the Oaxaca‐Blinder decomposition. Findings – Small firms face greater obstacles in accessing training and the main reasons for that are related to their technological activity and the geographic scope of the market in which they operate. Together, these variables explain about half of the training gap in both the participation and the quantity decisions. Practical implications – The limited access to training of small firms prevents them from becoming more competitive by using a tool that would permit a better adoption of new technology and access to foreign markets. Originality/value – The paper exploits the data on training expenditure and relates this investment with other firms' strategies, such as innovation or internationalization. It also suggests estimating this type of data by means of a two‐part model.