Understanding the processes of firm Growth - a closer look at serial growth rate correlation

Alex Coad ()

Cahiers de la Maison des Sciences Economiques from Université Panthéon-Sorbonne (Paris 1)

Abstract: Serial correlation in annual growth rates carries a lot of information on growth processes - it allows us to directly observe firm performance as well asto test hypotheses. Using a 7-year balanced panel of 10 000 French manufacturing firms, we observe that small firms typically are subject to negative correlation of growth rates, whereas larger firms display positive correlation. Furthermore, we find that those small firms that experience extreme positive or negative growth in any one year are unlikely to repeat this performance in the following year.

Keywords: Serial correlation; firm growth; quantile regression. (search for similar items in EconPapers)
JEL-codes: L11 L25 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ent and nep-tid
Date: 2006-06
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Persistent link: http://EconPapers.repec.org/RePEc:mse:wpsorb:r06051

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