The Determinants of Corporate Growth

Francisco Rosique

MPRA Paper from University Library of Munich, Germany

Abstract: Corporate Growth is a concept that has been widely treated in a specific way or as part of strategy theories, in definition and in econometric models and has also been studied in many different aspects and approaches. The author describes in depth the main variables affecting corporate growth and the underlying business processes. This empirical research has focused on Sales, Profit-Cash Flow, Risk, Created Shareholder Value, Market Value and Overall Performance econometric models. These panel data models are based on the 500 Companies of the Standard & Poor’s 500. The methodology used has been very strict in identifying exogenous variables, walking through the different alternative econometric models, discussing results, and, in the end, describing the practical implications in today’s business corporate management. We basically assume that the Functions/Departments act independently in the same company, many times with different objectives, and in this situation clear processes are key to clarify the situations, roles and responsibilities. We also assume that growth implies interactions among the different functions in a company and the CEO acts to lead and coach his immediate Directors as a referee of the key conflicts through his Operating Mechanism. The objective of this PhD Dissertation is to clarify the business priorities and identify the most relevant variables in every process leading to the highest efficiency in reaching a sustainable and profitable growth. It covers the lack of academic studies on the nature and specific driving factors of corporate growth and provides a working framework for Entrepreneurs and Management leading to the Company’s success.

Keywords: Models with Panel Data; Capital; Produtivity; Firm choice; Growth; Investment; Corporate Finance; Firm objectives; Firm performance; Industry studies; Manufacturing; Primary products and construction; Services; Transportation and utilities; Business economics; Research and development (search for similar items in EconPapers)
JEL-codes: C33 D24 D92 G30 L21 L25 L60 L70 L80 L90 M21 O32 (search for similar items in EconPapers)
Date: 2010-06-23
New Economics Papers: this item is included in nep-bec, nep-cse and nep-sbm
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