A Closer Look at Serial Growth Rate Correlation

A Closer Look at Serial Growth Rate Correlation Serial correlation in annual growth rates carries a lot of information on growth processes – it allows us directly to observe firm performance as well as to test theories. Using a seven-year balanced panel of 10,000 French manufacturing firms, we observe that small firms typically are subject to negative correlation of annual growth rates, whereas larger firms display positive correlation. Furthermore, we find that those small firms that experience extreme positive or negative growth in any one year are unlikely to repeat this performance in the following year. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Industrial Organization Springer Journals

A Closer Look at Serial Growth Rate Correlation

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Publisher
Springer US
Copyright
Copyright © 2007 by Springer Science+Business Media, LLC
Subject
Economics; Industrial Organization; Microeconomics
ISSN
0889-938X
eISSN
1573-7160
D.O.I.
10.1007/s11151-007-9135-y
Publisher site
See Article on Publisher Site

Abstract

Serial correlation in annual growth rates carries a lot of information on growth processes – it allows us directly to observe firm performance as well as to test theories. Using a seven-year balanced panel of 10,000 French manufacturing firms, we observe that small firms typically are subject to negative correlation of annual growth rates, whereas larger firms display positive correlation. Furthermore, we find that those small firms that experience extreme positive or negative growth in any one year are unlikely to repeat this performance in the following year.

Journal

Review of Industrial OrganizationSpringer Journals

Published: Aug 7, 2007

References

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