Arriving at the high-growth firm

Delmar, Frédéric; Davidsson, Per; Gartner, William B.

doi:10.1016/s0883-9026(02)00080-0

Cited by 1,068 publications

(1,021 citation statements)

References 27 publications

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“…The signs are generally positive, with the exception of the correlation between employment growth and labour productivity growth. 12 However, the correlations are indeed far from perfect, as already noted by Delmar et al (2003). The largest correlation coefficient is between growth of gross operating surplus and growth of labour productivity (0.6137, or 0.7256 if we look at the Spearman's rank coefficient), while the values are much lower in the other cases.…”

Section: Data and Variablesmentioning

confidence: 85%

Growth processes of Italian manufacturing firms

Coad¹,

Rao

Tamagni

2011

Structural Change and Economic Dynamics

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This paper presents a multidimensional empirical analysis of firm growth. Exploiting census data on Italian manufacturing firms, 1989-1997, we estimate a reduced-form VAR to analyze the co-evolution of employment growth, sales growth, growth of profits and labour productivity growth. Our main findings suggest that (i) employment growth precedes sales growth; (ii) productivity growth lacks any strong association with subsequent growth of the other indicators; (iii) profits growth represents the 'absorbing dimension' of the growth processes. This picture contrasts with 'accelerator models', predicting sales are the driver of the growth process, and is also at odds with theories of firm-industry evolution assuming productivity or profits advantages to be the driver of strong market selection/reallocation mechanisms. Instead, the findings reveal the existence of (weak) Penrose and (strong) Kaldor-Verdoorn effects, and more generally convey the view that employment growth is the key driver of firm expansion, while profits, once made, are not reinvested.JEL codes: C30, D20, L20, L25

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Section: Data and Variablesmentioning

confidence: 85%

Growth processes of Italian manufacturing firms

Coad¹,

Rao

Tamagni

2011

Structural Change and Economic Dynamics

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“…Therefore, it is perhaps not surprising that previous empirical studies on the industry distribution of HGFs paint a rather ambiguous picture. Early research found evidence of a link between technology and firm growth (Storey 1991(Storey , 1994Kirchoff 1994), and a number of more recent studies have found indications of a positive association between high-tech status or R&D intensity and HGFs (Schreyer 2000;Delmar et al 2003;Hölzl 2009;Wennberg 2009). Schreyer (2000: 25), in a study covering six European countries, notes that "all the existing evidence points in the same direction: high-growth firms are more technology intensive than the average firm."…”

Section: Innovation Activities Firm Growth and Hgfsmentioning

confidence: 99%

Are high-growth firms overrepresented in high-tech industries?

2015

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract: It is frequently argued that policymakers should target high-tech firms, i.e., firms with high R&D intensity, because such firms are considered more innovative and therefore potential fast-growers. This argument relies on the assumption that the association among high-tech status, innovativeness and growth is actually positive. We examine this assumption by studying the industry distribution of high-growth firms (HGFs) across all 4-digit NACE industries, using data covering all limited liability firms in Sweden during the period 1997-2008. The results of fractional logit regressions indicate that industries with high R&D intensity, ceteris paribus, can be expected to have a lower share of HGFs than can industries with lower R&D intensity. The findings cast doubt on the wisdom of targeting R&D industries or subsidizing R&D to promote firm growth. In contrast, we find that HGFs are overrepresented in knowledge-intensive service industries, i.e., service industries with a high share of human capital. Terms of use: Documents in

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“…Firm growth is clearly a multidimensional phenomenon (Davidsson et al, 2006;Penrose, 1995;Storey, 1982). Fitzsimmons et al (2005) describe firm growth measures based on Delmar et al (2003) with the intention to evaluate measures of firm performance. Markman and Gartner (2002) review several articles, and find that relative growth measures create a bias favouring small firms, e.g.…”

Section: Firm Growth Size Profitability and Their Measuresmentioning

confidence: 99%

Testing relationships between firm size and perceptions of growth and profitability: An investigation into the practices of Australian ICT SMEs

Perényi

Yukhanaev

2016

Journal of Management & Organization

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Gibrat’s Law mandates the independence of firm size and growth, while the resource-based view of the firm implies a positive relationship between firm size and profits, to be concluded in a profit–growth trade-off. Empirical studies of entrepreneurial success however, have demonstrated firms’ ability to reach a state of high growth and profitability, despite the trade-offs encapsulated within the profit–growth nexus. Upon assessing the relationships between past profitability, current firm growth and size in Australian ICT SMEs, results demonstrate positive relationships between all three indicators. This suggests that profitability can be considered the most important precursor of entrepreneurial success, and also that successful businesses do not suffer from the trade-offs implied by theory.

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Arriving at the high-growth firm

Cited by 1,068 publications

References 27 publications

Growth processes of Italian manufacturing firms

Growth processes of Italian manufacturing firms

Are high-growth firms overrepresented in high-tech industries?

Testing relationships between firm size and perceptions of growth and profitability: An investigation into the practices of Australian ICT SMEs

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