Is there a risk of growing fast? The relationship between organic employment growth and firm exit

Haibo Zhou, Peter Van Der Zwan

Research output: Journal PublicationArticlepeer-review

8 Citations (Scopus)

Abstract

Growing firms are the drivers of economic dynamics. While the existing literature often focuses on the average effect of growth on firm survival, we investigate how survival rates vary across the growth distribution using Dutch longitudinal firm-level data (1999-2012). We theorize and find a U-shaped relationship between organic employment growth and subsequent exit due to firm death in various model specifications. Low positive growth increases survival, too much growth could be harmful for some subgroups of firms, and the steepness of the U-shape depends on firm age, size, and industry.

Original languageEnglish
Pages (from-to)1297-1320
Number of pages24
JournalIndustrial and Corporate Change
Volume28
Issue number5
DOIs
Publication statusPublished - 1 Oct 2019

Keywords

  • L21
  • L25
  • L26
  • M21

ASJC Scopus subject areas

  • Economics and Econometrics

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