Innovation and firm growth: Does firm age play a role?

Coad, Alex; Segarra‐Blasco, Agustí; Teruel, Mercedes

doi:10.1016/j.respol.2015.10.015

Cited by 655 publications

(490 citation statements)

References 88 publications

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“…For example, new companies usually face high costs of experimentation and they must provide training to new R&D employees. Older companies, in contrast, are more efficient at introducing process innovations as they have the financial backing entailed by uncertain mid-term returns characterising innovation, and they tend to prefer exploitation over exploration (Coad et al 2016). As such, young born green companies entering markets with their innovative products and services are likely to face significantly different innovation challenges compared to the more established firms that adopt environmentally friendly innovations as a reaction to the changing industry landscape.…”

Section: The Green Industry and Corporate Life Cyclementioning

confidence: 99%

“…Unlike their more established and larger counterparts, these new organisations take time to understand sustainability and feasibility before rapidly developing into lucrative and technologically challenging niche green areas. Start-ups within green initiatives are therefore better poised to benefit from radical innovations building on breakthrough eco-technologies, and, at the same time, to internalise negative externalities, regulatory challenges and compliance costs by factoring these into economic decisions upfront and, thus, achieving faster growth and enhanced competitiveness (Ács and Audretsch 1990;Coad et al 2016;Porter and van der Linde 1995). Yet, most of the literature is still limited to the remits of more established firms, leaving gaps in the understanding of green entrepreneurial firms and their activities.…”

Section: The Green Industry and Corporate Life Cyclementioning

confidence: 99%

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Born to be green: new insights into the economics and management of green entrepreneurship

et al. 2017

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While the number of green start-ups has steadily increased around the world in response to the environmental problems demanding immediate solutions, there are several unresolved questions on the behaviour and performance of such ventures. The papers in this special issue shed light on these issues by underscoring the role of several factors, such as industry life cycles, knowledge spillovers, institutions, and availability of external finance, in shaping decision-making and firm behaviour in green start-ups. This paper highlights the state-of-the-art developments in the literature, discusses the key contributions of the papers put together in this special issue, and presents a future research agenda for scholars interested in green entrepreneurship.

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Section: The Green Industry and Corporate Life Cyclementioning

confidence: 99%

Section: The Green Industry and Corporate Life Cyclementioning

confidence: 99%

Born to be green: new insights into the economics and management of green entrepreneurship

et al. 2017

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“…Dutta et al (1999) and Nath et al (2010) found that OCAP correlated positively with the proclivity for the defender strategy. The fourth control variable, Age (AGE), is the number of years a company had been operating, which correlated inversely with the prospector and defender strategies (Cucculelli, 2014;Coad et al, 2016). Fifth, firm size (SIZE), measured using a natural logarithm of total assets, indicated that a bigger firm size implied more resources and greater capabilities, thus the organization was better structured and would tend to focus on either a prospector or defender strategy; not a hybrid strategy (analyzer).…”

Section: Control Variablesmentioning

confidence: 99%

Environmental Uncertainty as a Contingent Factor of Business Strategy Choice Decision: Introducing an Alternative Measurement of Uncertainty

Arieftiara¹,

Utama²,

Wardhani³

2017

AABFJ

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This study aims to examine a contingent factor of business strategy decisions, namely environmental uncertainty. The study applies secondary data as an alternative method to analyze technological uncertainty: a component of environmental uncertainty. To examine environmental uncertainty, this study develops an Environmental Uncertainty Index (EUI). Utilizing a sample of manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the period from 2009 to 2012 and a multinomial logistic regression, this study finds that the probability of a company pursuing a prospector strategy is greater than an analyzer strategy. Notwithstanding, the study fails to prove that the probability of a company opting for a defender strategy is greater than an analyzer approach. The findings suggest that the new measure of technological uncertainty is more applicable than the other existing measures. Furthermore, EUI measures the environmental uncertainty objectively, therefore, this new measure could be applied to future research. In general, this study broadens understanding concerning the relationship between business strategy and its contingent factors, namely environmental uncertainty. KeywordsBusiness strategy, contingent factor, environmental uncertainty, Indonesia. AbstractThis study aims to examine a contingent factor of business strategy decisions, namely environmental uncertainty. The study applies secondary data as an alternative method to analyze technological uncertainty: a component of environmental uncertainty. To examine environmental uncertainty, this study develops an Environmental Uncertainty Index (EUI). Utilizing a sample of manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the period from 2009 to 2012 and a multinomial logistic regression, this study finds that the probability of a company pursuing a prospector strategy is greater than an analyzer strategy. Notwithstanding, the study fails to prove that the probability of a company opting for a defender strategy is greater than an analyzer approach. The findings suggest that the new measure of technological uncertainty is more applicable than the other existing measures. Furthermore, EUI measures the environmental uncertainty objectively, therefore, this new measure could be applied to future research. In general, this study broadens understanding concerning the relationship between business strategy and its contingent factors, namely environmental uncertainty.JEL Classification: L10, L20, M14.

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“…They use firm age as a moderator of R&D's impact on knowledge creation. Coad et al (2016) explore the relationship between innovation and firm growth for firms of different ages showing that young firms face larger performance benefits from R&D at the upper quantiles of the growth rate distribution, but face larger decline at the lower quantiles. They also conclude that R&D investment by young firms appears to be significantly riskier than R&D investment made by mature firms.…”

Section: Literature Reviewmentioning

confidence: 99%

Why do Firms Live Longer than Others? The Elixir of (Eternal) Life of Blue Chip American Companies

Reis¹

2017

IJBA

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Purpose: Why do certain companies live longer than others? The average lifespan of a listed north and South American company is over 33 years and in Europe the average age of a company is 52 (Note 1). In 1288, Stora Enso a big pulp and paper company from Sweden issued its first share. According to credit rating agency Tokyo Shoko Research, in Japan, there are more than 20,000 companies with more than 100 years' old. Through a sample of blue ship American listed oldest companies and quarter panel data from 1988-2013 this article identifies more than 8 significant explanatory variables and ascertains relevant factors related with longevity.Methodology: A new robust standard errors for panel regressions with cross-sectional dependence based on Driscoll-Kraay estimator is applied. This method (stata xtscc) is heteroskedasticity consistent and the standard error estimates are robust to general forms of cross-sectional and temporal dependence surpassing the deficiencies of traditional panel data statistical approaches.Findings: The sample of blue ship companies and panel regressions with Driscoll-Kraay estimator shows that the most relevant factors to induce longevity are related with growth opportunities perspective and horizon, cash liquidity, profitability and shareholders remuneration whether from dividends or repurchases, capital structure, strong claims-compliance-liability structure department, innovation and firm size.Originality: This paper's topic considers for the first-time age as a dependent variable and not a control one. Also, the large time period of study, including quarterly observations is new, as well as the original approach to estimation applied to this theme, considered as an alternative to traditional panel data methods.Practical implications: With these determinants identified, professionals and academics can use them as benchmarking and a recipe to endure and assuring bigger lifespan for other mature and young companies.

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Innovation and firm growth: Does firm age play a role?

Cited by 655 publications

References 88 publications

Born to be green: new insights into the economics and management of green entrepreneurship

Born to be green: new insights into the economics and management of green entrepreneurship

Environmental Uncertainty as a Contingent Factor of Business Strategy Choice Decision: Introducing an Alternative Measurement of Uncertainty

Why do Firms Live Longer than Others? The Elixir of (Eternal) Life of Blue Chip American Companies

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