Scandinavian Working Papers in Economics

Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

No 269: Born global firms – do they perform differently?

Torbjörn Halldin ()
Additional contact information
Torbjörn Halldin: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, Postal: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, SE-100 44 Stockholm, Sweden

Abstract: This paper investigates whether born global firms perform differently compared to other newly founded manufacturing firms. A rigorous quantitative treatment of born global firms has been absent in the international entrepreneurship literature. The quantitative focus of the paper adds to this literature. To a simple OLS estimation is added a matching approach in order to circumvent the absence of counterfactual for born global firms had they not chosen to pursue a born global strategy. Measuring performance five years after firm foundation, born global firms are found to have higher growth in employment and sales per employee but no such effect is found when performance is measured by profitability or labor productivity. For robustness purposes, similar results are found when the analysis is augmented to include a wider spread of born global firm definitions and having performance measured three to seven years subsequent to firm foundation.

Keywords: Born global firms; firm performance manufacturing firms

JEL-codes: F14; L25; L26; M13; M21

26 pages, March 16, 2012

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