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The Determinants Of Firm’S Growth: An Empirical Examination

Author

Listed:
  • FRANCISCO DIAZ HERMELO

    (Strategic Management and International Business, Universidad de San Andrés, San Fernando, Pcia. de Buenos Aires , Argentina)

  • ROBERTO VASSOLO

    (Business Policy, IAE – Universidad Austral, Pilar, Pcia. de Buenos Aires , Argentina)

Abstract

This research examines the determinants of firms’ growth. Our findings indicate that firms willing to grow substantially and government programs designed to boost firms’ growth should put emphasis on investing in newer technology, diversifying from regional markets towards national and international markets, and delivering adequate returns, which provide the financial means to grow. These factors proved to be the most statistically significant explaining the growth of the firms analyzed. The results also indicate that the growth of the firm was not significantly related with its size, which is consistent with Gibrat’s law.

Suggested Citation

  • Francisco Diaz Hermelo & Roberto Vassolo, 2007. "The Determinants Of Firm’S Growth: An Empirical Examination," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 10(1), pages 3-20.
    • Handle: RePEc:pch:abante:v:10:y:2007:i:1:p:3-20
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    File URL: http://www.abante.cl/files/ABT/Contenidos/Vol-10-N1/Diaz.pdf
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    References listed on IDEAS

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    2. Evans, David S, 1987. "The Relationship between Firm Growth, Size, and Age: Estimates for 100 Manufacturing Industries," Journal of Industrial Economics, Wiley Blackwell, vol. 35(4), pages 567-581, June.
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    6. Becchetti, Leonardo & Trovato, Giovanni, 2002. "The Determinants of Growth for Small and Medium Sized Firms: The Role of the Availability of External Finance," Small Business Economics, Springer, vol. 19(4), pages 291-306, December.
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. David Haritone Shikumo, 2021. "Effect of Share Capital on Financial Growth of Non-Financial Firms Listed at the Nairobi Securities Exchange," Papers 2108.10244, arXiv.org.
    2. Marko Peric & Vanja Vitezic & Ana Peric Hadzic, 2020. "Firm Size €“ Firm Growth Relationship During Economic Crisis," Economic Thought and Practice, Department of Economics and Business, University of Dubrovnik, vol. 29(1), pages 29-53, june.
    3. David Haritone Shikumo & Oluoch Oluoch & Joshua Matanda Wepukhulu, 2020. "Effect of Long-Term Debt on the Financial Growth of Non-Financial Firms Listed at the Nairobi Securities Exchange," Papers 2010.12596, arXiv.org, revised Nov 2021.
    4. José Niño-Amézquita & Fedor Legotin & Oleg Barbakov, 2017. "Economic success and sustainability in pharmaceutical sector: a case of Indian SMEs," Post-Print hal-01735846, HAL.
    5. José Niño-Amézquita & Fedor Legotin & Oleg Barbakov, 2017. "Economic success and sustainability in pharmaceutical sector: a case of Indian SMEs," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 5(1), pages 157-168, September.
    6. Marko Peric & Vanja Vitezic, 2016. "Impact of global economic crisis on firm growth," Small Business Economics, Springer, vol. 46(1), pages 1-12, January.
    7. Wolday Amha & Tadele Ferede & Mulat Demeke, 2014. "The Impact of Financial Access on Firm Growth: evidence from Ethiopian Grain Traders and Millers," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 22(1), November.
    8. Marko Peric & Vanja Vitezic, 2016. "Impact of global economic crisis on firm growth," Small Business Economics, Springer, vol. 46(1), pages 1-12, January.

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    More about this item

    Keywords

    Firm growth; Small businesses; Firm development;
    All these keywords.

    JEL classification:

    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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