High-growth firms

Abstract

High-Growth Firms (HGFs) have received increasing attention from scholars, practitioners, and policy-makers in recent years. HGFs make a disproportionately large contribution to economic dynamism and growth. HGFs may play a valuable role in innovation systems, as conduits for the diffusion of technological innovations. While R&D is considered to be an innovation input, for example, HGFs can arguably be considered to be indicators of innovation output. We begin by considering some stylized facts of HGFs, such as the impressive role of outliers, the lack of persistence in high-growth events, findings that HGFs tend to be young, and the difficulties surrounding the prediction of which firms will become HGFs. With regards to innovation, Schumpeterian intuitions suggest that HGFs are highly innovative, although the available empirical evidence suggests that HGFs are not more common in high-tech sectors. Nevertheless, HGFs may be relatively innovative within their sectors, for example if they operate in low-tech sectors using sophisticated routines and procedures.