Growth and Finance Constraints in Indian Manufacturing Firms

Posted: 28 Aug 2013

See all articles by Vikash Gautam

Vikash Gautam

Indira Gandhi Institute of Development Research (IGIDR)

Date Written: November 20, 2012

Abstract

In this paper we attempt to evaluate the impact of finance constraints on the growth of firms. We also take in our purview some of the other debated issues relating to firm growth such as growth distribution, persistence and influence of size and maturity. For a sample of 2282 Indian manufacturing firms in the period 1994 to 2009, we show that the growth process of firms does not follow normal distribution; growth of firms is persistent and; size, maturity and finance constraints negatively influence the growth of firms. We check the robustness of our results using alternative samples, firm growth measures and estimation techniques.

Keywords: finance constraints, firm growth, growth distribution, persistence, size, maturity

JEL Classification: G30, L25

Suggested Citation

Gautam, Vikash, Growth and Finance Constraints in Indian Manufacturing Firms (November 20, 2012). Available at SSRN: https://ssrn.com/abstract=2316979

Vikash Gautam (Contact Author)

Indira Gandhi Institute of Development Research (IGIDR) ( email )

Gen A.K. Vaidya Marg Santoshnagar
Goregaon (East)
Mumbai, Maharashtra 400065
India

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