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Growth processes of high-growth firms as a four-dimensional chicken and egg

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posted on 2023-06-09, 02:40 authored by Alex Coad, Marc Cowling, Josh SiepelJosh Siepel
This article investigates whether high-growth firms grow in different ways from other firms. Specifically, we analyze how firms grow along several dimensions (growth of sales, employment, assets, and operating profits) using Structural Vector Autoregressions. Causal relations are identified by using information contained in the (non-Gaussian) growth rate distributions. For most firms, the growth process starts with employment growth, which is then followed by sales growth, then growth of operating profits, and finally growth of assets. In contrast, high growth firms put more emphasis on growth of operating profits driving other dimensions of growth, with employment growth occurring at the end.

Funding

Innovation Research Centre; ESRC; ES/J008427/1

History

Publication status

  • Published

File Version

  • Published version

Journal

Industrial and Corporate Change

ISSN

0960-6491

Publisher

Oxford University Press

Issue

4

Volume

26

Page range

537-554

Department affiliated with

  • SPRU - Science Policy Research Unit Publications

Full text available

  • Yes

Peer reviewed?

  • Yes

Legacy Posted Date

2016-08-30

First Open Access (FOA) Date

2017-04-04

First Compliant Deposit (FCD) Date

2017-04-04

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