Entrepreneurship and the Growth of Firms

Entrepreneurship and the Growth of Firms

Per Davidsson, Frédéric Delmar and Johan Wiklund

In this book, three leading scholars have integrated some of their most important research in order to answer these questions on firm growth. The result is a volume that builds on studies of many thousands of firms in several different projects. It offers deep insights into the firm growth phenomenon and how it can be studied.

Chapter 8: High-Growth Firms and Their Contribution to Employment: The Case of Sweden 1987–96

Per Davidsson, Frédéric Delmar and Johan Wiklund

Subjects: business and management, entrepreneurship


1 Per Davidsson, Frédéric Delmar INTRODUCTION The dynamics of job creation have in recent years attracted increased interest on the part of academics as well as policy-makers. In connection to this, a number of studies carried out in various countries have concluded that small and medium enterprises (SMEs) play a very large and/or growing role as job creators (Baldwin and Picot, 1995; Birch, 1979; Davidsson, Lindmark and Olofsson, 1993; 1994; 1995; 1998a; 1998b; Fumagelli and Mussati, 1993; Kirchhoff and Phillips, 1988; Picot and Dupuy, 1998, Spilling, 1995; for further reference to studies carried out in a large number of countries see also Aiginger and Tichy, 1991; ENSR, 1994; Loveman and Sengenberger, 1991; OECD, 1987; Storey and Johnson, 1987). While most researchers agree on the importance of SMEs, there is some controversy as regards whether their great role in job creation is mainly a result of many small start-ups and incremental expansions, or if a small minority of high growth SMEs contribute the lion’s share of new employment. This is known as the ‘mice vs. gazelles’ or ‘flyers vs. trundlers’ debate. Storey and Birch strongly advocate the position that the small group of high growth SMEs are the real job creators in the UK and US, respectively (Birch and Medoff, 1994; Storey, 1994; Storey and Johnson, 1987) whereas, for example, the Davidsson et al. research in Sweden (cf. above) gives more support for the ‘mice’ hypothesis. The different views may in part be due to real country differences. It...

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