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The Determinants of Small Firm Growth in the Greek Manufacturing Sector


  • Agiomirgianakis, G.

    () (Hellenic Open University)

  • Asteriou, D.

    () (City University London)


The aim of this paper is twofold; first, to identify the variables that mostly affect rapid sales growth in Greek manufacturing small and medium sized enterprises (SMEs); second, to examine the potential influence upon business growth and performance outcomes of those variables representing enterprise and financial management characteristics of the Greek SMEs. The study utilizes panel data of a random sample of 143 firms from the manufacturing SMEs sector in Greece. Regression analysis is used to determine the explanatory factors of rapid sales growth. This paper is firstly addressing the Greek case and our results are in line with the findings of other empirical studies in the European Union (EU), thus, supporting the convergence hypothesis among member states in EU. Indeed, factors found to influence significantly manufacturing SMEs growth in Greece are profitability, liquidity, reliance on long-term debt, employee productivity, fixed assets turnover and restricted sales credit terms. Moreover, our findings also suggest that SMEs located in big cities behave differently from firms located in the periphery with regard to factors related to growth. The same holds true for firms in different industry subgroups. Our findings give rise to several policy implications that are crucial for the competitiveness of the sector, especially in view of the changes induced by the European Monetary Union, as well as, by other undergoing economic changes in the country such as the Olympic Games 2004. Policies such as low cost financing, lower tax burdens, incentives for investments in new technology, continuous personnel training, promotion of ecommerce and cooperation with foreign firms might induce fast growth in Greek SMEs.

Suggested Citation

  • Agiomirgianakis, G. & Asteriou, D., 2003. "The Determinants of Small Firm Growth in the Greek Manufacturing Sector," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 18, pages 817-836.
  • Handle: RePEc:ris:integr:0261

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    Cited by:

    1. Mercedes Teruel-Carrizosa, 2010. "Gibrat’s law and the learning process," Small Business Economics, Springer, vol. 34(4), pages 355-373, May.
    2. Subrata Ghatak & Alan Mulhern & Chris Stewart, 2005. "Regional Development of Small Firms in Poland," Economic Change and Restructuring, Springer, vol. 38(2), pages 129-146, June.
    3. F. Voulgaris & G. Agiomirgianakis & T. Papadogonas, 2015. "Job creation and job destruction in economic crisis at firm level: the case of Greek manufacturing sectors," International Economics and Economic Policy, Springer, vol. 12(1), pages 21-39, March.
    4. Ghatak, Subrata & Mulhern, Alan & Stewart, Chris, 2003. "Determinants of intended expansion of Polish small firms," Journal of Policy Modeling, Elsevier, vol. 25(3), pages 287-296, April.
    5. Martin Falk & Eva Hagsten, 2015. "Export status and firm growth of European SMEs," Economics Bulletin, AccessEcon, vol. 35(2), pages 1330-1338.
    6. Patrycja Grinberger & Natalia Nehrebecka, 2015. "Determinants of firm’s growth: empirical study of Polish listed companies," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 43.

    More about this item


    Capital structure; Industry study; Manufacturing; Panel data;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General


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