The returns to firm-provided training depend on many different factors. Firm size is an important indicator of various of these factors, but recent research tends to neglect it. In this study the returns to firm-provided training are estimated, taking account of three possible firm-size effects: the HRM effect, selection effect and scale effect. Using panel data on 173 Dutch firms, support is found for the existence of the HRM effect: training support per working day (the average time a firm spends on setting up and coordinating a training program) has a positive influence on the returns to training. In the absence of training support, training has no effect on production. Since on average smaller firms provide less training support per working day, this implies that small firms benefit less from firm-provided training than their larger counterparts.

SMEs, firm provided training
Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital: General (jel J20), Human Capital; Skills; Occupational Choice; Labor Productivity (jel J24)
Tinbergen Institute Discussion Paper Series
Tinbergen Institute

de Kok, J.M.P. (2000). The Impact of Firm-Provided Training on Production: Testing for Firm-Size Effects (No. TI 00-073/3). Tinbergen Institute Discussion Paper Series. Retrieved from