Does young firm growth persist? The role of firm age

Abstract

This study investigates serial correlation in growth rates of young firms. Specifically, we examine how past growth affects current growth and how this relationship is moderated by firm age. We use data from four cohorts of Spanish firms tracked over their first 10 years of operation. Results from regression analyses show a positive autocorrelation of growth rates. However, we also find that they become erratic with age. The study contributes to the literature by providing a nuanced view of growth autocorrelation in the case of young firms.

This study investigates serial correlation in growth rates of young firms. Specifically, we examine how past growth affects current growth and how this relationship is moderated by firm age. We use data from four cohorts of Spanish firms tracked over their first 10 years of operation. Results from regression analyzes show a positive autocorrelation of growth rates. However, we also find that they become erratic with age. The study contributes to the literature by providing a nuanced view of growth autocorrelation in the case of young firms.

Este estudo investiga a autocorrelação serial nas taxas de crescimento de empresas jovens. Especificamente, examinamos como o crescimento passado afeta o crescimento atual e como essa relação é moderada pela idade da empresa. Utilizamos dados de quatro coortes de empresas espanholas acompanhadas durante seus primeiros 10 anos de operação. Os resultados das análises de regressão mostram uma autocorrelação positiva das taxas de crescimento. No entanto, também constatamos que essas taxas se tornam erráticas com o passar do tempo. O estudo contribui para a literatura ao fornecer uma visão mais detalhada da autocorrelação do crescimento no caso de empresas jovens.