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Free to grow? Assessing the barriers faced by actual and potential high growth firms

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  • Lee, Neil

Abstract

A small proportion of high growth firms create the majority of all new jobs. For policymakers, it is important to know (1) the obstacles faced by high growth firms are and (2) the obstacles faced by firms with the potential to achieve high growth, but which are yet to achieve this. This investigates these issues using the UK Small Business Survey. It highlights six areas where high growth firms experience problems: obtaining finance, cash flow, recruiting staff, skill shortages, managerial skills and the availability and cost of premises. Potential high growth firms argue that cash flow, recruiting, the availability and cost of premises and managerial skills are important. They also argue that competition is a significant obstacle to their growth, perhaps implying their business strategy is problematic.

Suggested Citation

  • Lee, Neil, 2011. "Free to grow? Assessing the barriers faced by actual and potential high growth firms," MPRA Paper 36396, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:36396
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    References listed on IDEAS

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    1. Magnus Henrekson & Dan Johansson, 2010. "Gazelles as job creators: a survey and interpretation of the evidence," Small Business Economics, Springer, vol. 35(2), pages 227-244, September.
    2. Neil Lee & Max Nathan, 2011. "Does Cultural Diversity Help Innovation in Cities: Evidence from London Firms," SERC Discussion Papers 0069, Spatial Economics Research Centre, LSE.
    3. Coad, Alex & Rao, Rekha, 2008. "Innovation and firm growth in high-tech sectors: A quantile regression approach," Research Policy, Elsevier, vol. 37(4), pages 633-648, May.
    4. Bryson, Alex & Dorsett, Richard & Purdon, Susan, 2002. "The use of propensity score matching in the evaluation of active labour market policies," LSE Research Online Documents on Economics 4993, London School of Economics and Political Science, LSE Library.
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    Cited by:

    1. repec:cep:cepisp:05 is not listed on IDEAS
    2. Giorgio Barba Navaretti & Davide Castellani & Fabio Pieri, 2014. "Age and firm growth: evidence from three European countries," Small Business Economics, Springer, vol. 43(4), pages 823-837, December.
    3. Fabio Pieri, 2015. "Vertical organization of production and firm growth behavior," Working Papers 1508, Department of Applied Economics II, Universidad de Valencia.

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    More about this item

    Keywords

    High growth firms; Barriers; gazelles; SMEs; Firm growth;
    All these keywords.

    JEL classification:

    • L0 - Industrial Organization - - General
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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