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High-growth SMEs versus non-high-growth SMEs: a discriminant analysis


  • Ana M. Moreno
  • José C. Casillas


The purpose of this paper is to analyse the main variables that allow one to distinguish between high-growth firms and non-high-growth firms. Theoretically, we discuss such differences through a combination of economic (external approach) and strategic (internal approach) visions. Empirically, this paper provides two differences with regard to previous literature: (1) the primary goal of our work is not to provide an outright explanation of firm growth; rather, we aim to establish what characteristics enable us to distinguish between high-growth and non-high-growth firms. This aspect determines the methodology used (discriminant analysis with dichotomic dependent variable); and (2) firm high growth is understood as an extraordinary growth in comparison with the average growth of other firms in the same industry, and not in absolute terms. The results show that in the main high-growth firms are different from moderate-growth firms or declining firms because of their smaller size (which is contrary to Gibrat's Law), their higher availability of idle resources (consistent with the theory of resources and capabilities), and in some cases, their lower availability of financial resources (consistent with the existing literature on entrepreneurship).

Suggested Citation

  • Ana M. Moreno & José C. Casillas, 2007. "High-growth SMEs versus non-high-growth SMEs: a discriminant analysis," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 19(1), pages 69-88, January.
  • Handle: RePEc:taf:entreg:v:19:y:2007:i:1:p:69-88
    DOI: 10.1080/08985620601002162

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    Cited by:

    1. Daunfeldt, Sven-Olov & Elert, Niklas & Johansson, Dan, 2010. "The Economic Contribution of High-Growth Firms: Do Definitions Matter?," Ratio Working Papers 151, The Ratio Institute.
    2. Suh, Yongyoon & Kim, Moon-Soo, 2014. "Internationally leading SMEs vs. internationalized SMEs: Evidence of success factors from South Korea," International Business Review, Elsevier, vol. 23(1), pages 115-129.
    3. Oriol Amat & Marcos Antón Renart & María José García, 2013. "Factors that determine the evolution of high-growth businesses," Economics Working Papers 1377, Department of Economics and Business, Universitat Pompeu Fabra.
    4. Alb Maria, 2015. "Theoretical And Practical Considerations On Financial Autonomy And Balance Local Budgets In Romania," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 1, pages 239-245, February.
    5. Céline Bérard & Séverine Saleilles, 2016. "Sustainability-driven entrepreneurship and high-growth SME: How to combine Davids’ and Goliaths’ worlds?," Post-Print halshs-01459141, HAL.
    6. Demir, Robert & Wennberg, Karl & McKelvie, Alexander, 2016. "The Strategic Management of High-Growth Firms: A Review and Theoretical Conceptualization," Ratio Working Papers 273, The Ratio Institute.
    7. Laure Ambroise & Nathalie Claveau & Muriel Perez & Isabelle Prim-Allaz & Martine Séville & Christine Teyssier, 2013. "Firm'S Growth Profiles And Ceo'S Attitudes: The Moderating Role Of Growth Intention On Firm'S Growth?," Post-Print hal-01613823, HAL.
    8. José Miguel Giner & María Jesús Santa-María & Antonio Fuster, 2017. "High-growth firms: does location matter?," International Entrepreneurship and Management Journal, Springer, vol. 13(1), pages 75-96, March.
    9. Minghao Li & Stephan J. Goetz & Mark Partridge & David A. Fleming, 2016. "Location determinants of high-growth firms," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 28(1-2), pages 97-125, January.
    10. Sven-Olov Daunfeldt & Niklas Elert & Dan Johansson, 2014. "The Economic Contribution of High-Growth Firms: Do Policy Implications Depend on the Choice of Growth Indicator?," Journal of Industry, Competition and Trade, Springer, vol. 14(3), pages 337-365, September.
    11. Coad, Alex & Segarra, Agustí & Teruel, Mercedes, 2013. "Like milk or wine: Does firm performance improve with age?," Structural Change and Economic Dynamics, Elsevier, vol. 24(C), pages 173-189.
    12. Gebreeyesus, Mulu, 2009. "Innovation and Microenterprises Growth in Ethiopia," MERIT Working Papers 053, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    13. Besnik A. Krasniqi & Sameeksha Desai, 2016. "Institutional drivers of high-growth firms: country-level evidence from 26 transition economies," Small Business Economics, Springer, vol. 47(4), pages 1075-1094, December.
    14. Cécile Chanut-Guieu & Gilles Guieu, 2012. "Les caractéristiques du dirigeant de PME en hypercroissance : une revue de la littérature," Post-Print halshs-01413710, HAL.
    15. Manley, Karen, 2008. "Against the odds: Small firms in Australia successfully introducing new technology on construction projects," Research Policy, Elsevier, vol. 37(10), pages 1751-1764, December.
    16. Jarle Bastesen & Eirik Vatne, 2014. "Rapid-growth firms: exploring the role and location of entrepreneurial ventures," Chapters,in: Agglomeration, Clusters and Entrepreneurship, chapter 8, pages 159-198 Edward Elgar Publishing.
    17. repec:ksa:szemle:1695 is not listed on IDEAS
    18. Marta Gancarczyk, 2015. "Proces wzrostu przedsiębiorstwa w świetle podejścia zasobowego i teorii kosztów transakcyjnych," Gospodarka Narodowa, Warsaw School of Economics, issue 5, pages 5-31.
    19. Christina E. Bannier & Sabrina Zahn, 2014. "SMEs' Growth Heterogeneity - Evidence from Regional Developments," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 5(2), pages 23-49, March.
    20. Daria Ciriaci & Pietro Moncada-Paternò-Castello & Peter Voigt, 2016. "Innovation and job creation: a sustainable relation?," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(2), pages 189-213, August.
    21. Louis Raymond & Josée St-Pierre & Bruno Fabi & Richard Lacoursière, 2009. "From the intent to the growth of manufacturing SMEs: an empirical study of strategic configurations," Post-Print hal-01705771, HAL.
    22. Annie Peng Cui & Michael F. Walsh, 2011. "Internationalization Challenges for SMEs and Global Marketing Managers: A Case Study," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 1(1), pages 57-69, December.
    23. F. Xavier Molina-Morales & Josep Capó-Vicedo & M. Teresa Martínez-Fernández & Manuel Expósito-Langa, 2013. "Social capital in industrial districts: Influence of the strength of ties and density of the network on the sense of belonging to the district," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 773-789, November.
    24. Schlepphorst, Susanne & Schlömer-Laufen, Nadine, 2016. "Schnell wachsende Unternehmen in Deutschland: Charakteristika und Determinanten ihres Wachstums," IfM-Materialien 246, Institut für Mittelstandsforschung (IfM) Bonn.
    25. 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.

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