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Growth and size of firms

Hart, Peter E. and Oulton, Nicholas (1996) Growth and size of firms. Economic Journal, 106 (438). pp. 1242-1252. ISSN 0013-0133

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Identification Number: 10.2307/2235518

Abstract

We use a dataset of 87,000 independent UK companies to investigate the relationship between firm size and growth. For the sample as a whole, a Galton-Markov model of regression towards the mean shows that growth is negatively related to initial size. However, when the sample is broken down by size group, we find that regression towards the mean only occurs for the smallest firms, e.g. those with eight employees or less. For larger firms, there is essentially no relationship between growth and size. Even for the smallest firm, our results may be due to transitory factors.

Item Type: Article
Official URL: https://academic.oup.com/ej
Additional Information: © 1996 Oxford University Press
Divisions: Centre for Macroeconomics
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HB Economic Theory
Date Deposited: 11 Dec 2020 15:18
Last Modified: 20 Oct 2021 01:05
URI: http://eprints.lse.ac.uk/id/eprint/107894

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