Chapter 5: Advancing firm growth research: a focus on growth mode instead of growth rate
Firm growth constitutes one of the central topics of entrepreneurship research. Despite substantial interest and massive empirical research, theoretical development in the field has been notably slow (e.g., Davidsson & Wiklund, 2000; Delmar, Davidsson, & Gartner, 2003; Shepherd & Wiklund, 2009). A telling illustration is that the most comprehensive, adequate, and popular theory on growth was developed some 50 years ago with Penrose’s (1959) publication of The Theory of the Growth of the Firm. In this chapter, we explain that a major reason for this lack of development is the impatience of researchers to prematurely address the question of ‘how much?’ before adequately providing answers to the question ‘how?’ In other words, the vast majority of the research has been occupied with explaining differences in growth across firms, not acknowledging that there may be substantially qualitative differences in terms of how firms go about achieving this growth. A recent review (Shepherd & Wiklund) found over 80 empirical studies in our leading management and entrepreneurship journals published over the past 15 years attempting to explain differences in growth, not considering potentially qualitative differences in firms’ growth paths.
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