Are high-growth firms one-hit wonders? Evidence from Sweden

Sven-Olov Daunfeldt and Daniel Halvarsson
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Daniel Halvarsson: The Royal Institute of Technology, Division of Economics, Postal: SE-100 44, Stockholm, and The Ratio Institute, P.O Box 3203, SE-103 64, Stockholm, Sweden

No 73, HUI Working Papers from HUI Research

Abstract: Most firms do not grow, and a small number of high-growth firms seem to create most new jobs. These firms have therefore received increasing attention among policymakers. The question is whether high-growth tends to persist? We investigate this question using data on 432,689 observations in Sweden during 1997-2008. We find that high-growth firms had declining growth rates in the previous 3-year period, and their probability of repeating high growth rates was very low. HGFs are essentially “one-hit wonders”, and it is thus doubtful whether policymakers can improve economic outcomes by targeting them.

Keywords: Gazelles; High-growth firms; Persistence; Autocorrelation; Transition Probabilities (search for similar items in EconPapers)
JEL-codes: L11 L25 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2012-11-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Journal Article: Are high-growth firms one-hit wonders? Evidence from Sweden (2015)
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