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

Coad, Alex, Cowling, Marc and Siepel, Josh (2017) Growth processes of high-growth firms as a four-dimensional chicken and egg. Industrial and Corporate Change, 26 (4). pp. 537-554. ISSN 0960-6491

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Abstract

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.

Item Type: Article
Schools and Departments: School of Business, Management and Economics > SPRU - Science Policy Research Unit
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic theory. Demography > HB0522 Income. Factor shares > HB0615 Entrepreneurship. Risk and uncertainty. Property
H Social Sciences > HB Economic theory. Demography > HB0848 Demography. Population. Vital events
H Social Sciences > HD Industries. Land use. Labour > HD0072 Economic development. Development economics. Economic growth
Depositing User: Josh Siepel
Date Deposited: 30 Aug 2016 14:08
Last Modified: 26 Aug 2017 08:14
URI: http://sro.sussex.ac.uk/id/eprint/63052

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Innovation Research CentreUnsetESRCES/J008427/1