Empirical Definition of a Scale-up

This book distinguishes between a theoretical definition and an empirical definition. The theoretical definition seeks to clarify the concept of a scale-up in the minds of readers, using familiar theoretical concepts (such as marginal cost) that may be prohibitively difficult to measure in standard datasets, because the theoretical ideas do not map neatly into empirical variables. An empirical definition is stated in terms of empirically relevant variables and concepts such as growth rates, growth indicators, and other variables that are found in available datasets. This chapter develops the empirical definition. It starts by stating four desirable properties of an empirical definition, and proceeds in 2 steps: Step 1 involves taking the subset of HGFs; and Step 2 involves selecting scale-ups from among non-scale-up HGFs on the basis of seven proposed conditions.