Firm Growth Dynamics in Croatia after 2000

Proceedings of 7th International Conference «Economic Integration, Competition and Cooperation», 2-3 April, 2009, Opatija, University of Rijeka – Faculty of Economics, CD with Full papers

15 Pages Posted: 19 Mar 2013 Last revised: 22 May 2013

See all articles by Marija Kastelan Mrak

Marija Kastelan Mrak

University of Rijeka - Faculty of Economics

Danijela Sokolic

University of Rijeka - Faculty of Economics

Nenad Vretenar

University of Rijeka - Faculty of Economics

Date Written: April 2, 2009

Abstract

The paper reports on an exploratory study, run as part of a broader research of international competitiveness of Croatian firms. It provides some tentative observations on the relationship of firm size to industrial dynamics and national competitiveness.

By observing changes in average firm size in a five year period, we search for explanations that can relate a falling average firm size with a rising GDP, a fact which contradicts general expectation. The most likely conclusion is that a period of steady economic growth has attracted new entrepreneurship thus causing the average firm size to decrease. At the same time, exposure to international competitive pressures raised the investment activity which led to an increase in labor productivity, which was able to compensate for eventual diseconomies of scale.

Keywords: firm size, competitiveness, theory of the firm, Croatia

JEL Classification: L11

Suggested Citation

Mrak, Marija Kastelan and Sokolic, Danijela and Vretenar, Nenad, Firm Growth Dynamics in Croatia after 2000 (April 2, 2009). Proceedings of 7th International Conference «Economic Integration, Competition and Cooperation», 2-3 April, 2009, Opatija, University of Rijeka – Faculty of Economics, CD with Full papers . Available at SSRN: https://ssrn.com/abstract=2232828 or http://dx.doi.org/10.2139/ssrn.2232828

Marija Kastelan Mrak (Contact Author)

University of Rijeka - Faculty of Economics ( email )

Ivana Filipovića 4
Rijeka, 51000
Croatia

Danijela Sokolic

University of Rijeka - Faculty of Economics ( email )

Ivana Filipovića 4
Rijeka, 51000
Croatia

Nenad Vretenar

University of Rijeka - Faculty of Economics ( email )

Ivana Filipovića 4
Rijeka, 51000
Croatia

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