Scandinavian Working Papers in Economics

Ratio Working Papers,
The Ratio Institute

No 263: High-growth firms: Not so vital after all?

Sven-Olov Daunfeldt (), Daniel Halvarsson () and Oana Mihaescu ()
Additional contact information
Sven-Olov Daunfeldt: HUI Research and Dalarna University, Postal: HUI Research, 103 29 Stockholm, Sweden and, Department of Economics, Dalarna University, 781 88 Borlänge,, Sweden
Daniel Halvarsson: The Ratio Institute, Postal: The Ratio Institute, P.O. Box 5095, SE-102 42 Stockholm, Sweden
Oana Mihaescu: HUI Research and Dalarna University, Postal: HUI Research, 103 29 Stockholm, Sweden and, Department of Economics, Dalarna University, 781 88 Borlänge,, Sweden

Abstract: High-growth firms have received considerable interest recently since they create most of the new jobs in the economy. The purpose of our paper is to investigate the characteristics of high-growth firms prior to their growth period, and whether these characteristics differ across industries. Using data on a large sample of limited liability firms in Sweden for the period 2007-2010, we find that high-growth firms do not have the characteristics that we typically associate with successful firms. On the contrary, our results indicate that high-growth firms have low profits and a weak financial position. This might explain why studies have found that high-growth firms are seldom capable of sustaining their high growth rates in subsequent periods, and thus question policies that are targeted towards these companies.

Keywords: Entrepreneurship; Firm growth; Gazelles; High-growth firms; High-impact firms; Innovation

JEL-codes: L11; L25

30 pages, December 23, 2015

Full text files

sod_dh_om_hgf_not_so_vital_after_all_263.pdf PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Martin Korpi ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2020-02-16 18:57:36.