To examine the drivers of small-and medium-sized enterprise (SME) growth, we adopt a holistic multivariate modelling approach, integrating macroeconomic determinants with the internal (firm characteristics and firm strategy) drivers more commonly investigated in firm growth studies. Utilising such an extended set of variables addresses a gap in the extant firm growth literature in relation to external growth factors, offering novel insights on the seeming randomness of firm growth. Our system generalised method of moments estimation results indicate that the macroeconomic environment influences firm growth both directly and indirectly. Based on the study of manufacturing SME growth in Ireland, our findings provide evidence on the integrated effects of macroeconomic conditions, firm characteristics and firm strategy for SME growth. They also highlight, from a theoretical perspective, the need to acknowledge the multidimensional nature of SME growth.

The eradication of extreme poverty remains an intractable global challenge. This paper explores social innovation (SI) as a strategy for fostering sustainable poverty reduction in a developing country, Nigeria. Analysis is based on semi‐structured interviews with founders of SI initiatives. Findings indicate SI as a sustainable poverty reduction strategy because it addresses: (i) some underlying causes of poverty such as poor nutrition and lack of access to education; (ii) different dimensions of sustainability (i.e., economic, social and environmental). The study also identifies socially innovative cultural practices such as traditional rotational saving/credit and apprenticeship schemes which help eradicate poverty by ensuring improved access to finance and encouraging entrepreneurship. Furthermore, results indicate local SI initiatives in Nigeria are largely private sector‐led, while a weak institutional environment hampers expansion. The study highlights the need for policy aimed at identifying, strengthening and scaling up innovative local practices, and creating favourable framework conditions for SI.

The subsidiaries of foreign-owned multinational firms make significant contributions to national Research and Development (R&D) in many host countries. Policymakers in host countries often support subsidiaries’ R&D efforts, through R&D grants and R&D tax credits. A key objective of this funding is to leverage R&D-driven firm performance benefits for the host economy. However, the subsidiary's parent firm may decide not to commercially exploit the results from host country-funded R&D projects, in the host country. Therefore, supporting subsidiaries’ R&D presents a unique risk, that significant amounts of scarce public R&D funding may translate into little, or no firm performance payoffs for the host economy. To address this issue, we construct a unique panel dataset, containing 24,404 observations of firms in Ireland over a 10-year period. Using this rich data, we first evaluate the impact of R&D grants and R&D tax credits on subsidiaries’ R&D. We then examine the link between policy-induced R&D from each policy instrument, and subsidiaries’ firm performance in the host country. Our study provides the first evaluation of (1) whether public R&D funding stimulates additional R&D investment in subsidiaries, (2) whether policy-induced R&D drives subsidiaries’ firm performance in the host country, and (3) the differential effects of R&D grants and R&D tax credits. We find that both R&D policy instruments drive subsidiary R&D, and that the policy-induced R&D results in substantial host country improvements in turnover, exports, and value added. Our results suggest several policy implications, particularly for economies pursuing an R&D strategy which targets foreign-owned subsidiaries.

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