Firm Dynamics by Age and Size Classes and the Choice of Size Measure

40 Pages Posted: 29 Jan 2021 Last revised: 16 Nov 2021

See all articles by Stelios Giannoulakis

Stelios Giannoulakis

Athens University of Economics and Business

Plutarchos Sakellaris

Athens University of Economics and Business

Date Written: December 6, 2020

Abstract

The relationship of firm size and age to its growth and survival differs according to whether size is measured by sales or employment. Using a large and representative dataset of Greek firms over the period 1999-2014, we find the following patterns. Controlling for age, there is a strong negative growth-size relationship when measuring size with sales, but a strong positive one when measuring size with employment. Controlling for size, there is a positive monotonic survival-age relationship when measuring size with sales, whereas survival is negatively related with age for young firms when we measure size with employment. Our results indicate that public policies aimed at supporting Small and Medium-sized Enterprises (SMEs) should be specialized to the employment scale and the sales scale of enterprises, separately.

Keywords: Firm growth, Sales, Employment, Firm size, Firm age

JEL Classification: D22, E23, E32, L21, L25, L26

Suggested Citation

Giannoulakis, Stelios and Sakellaris, Plutarchos, Firm Dynamics by Age and Size Classes and the Choice of Size Measure (December 6, 2020). Available at SSRN: https://ssrn.com/abstract=3747529 or http://dx.doi.org/10.2139/ssrn.3747529

Stelios Giannoulakis

Athens University of Economics and Business ( email )

76 Patission Street
GR-10434 Athens
Greece

Plutarchos Sakellaris (Contact Author)

Athens University of Economics and Business ( email )

76 Patission Street
Athens, 104 34
Greece
+302108203304 (Phone)
+3012108203383 (Fax)

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