The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa

Previous studies in both developed and developing economies have reported that firm growth declines with firm age and size. However, review of literature showed that there are limited studies to empirically assess the validity of this fact on firm growth in developing countries. As such, the purpos...

Descripción completa

Guardado en:

Detalles Bibliográficos
Autores principales:	Helper Zhou, Victor Gumbo
Formato:	article
Lenguaje:	EN
Publicado:	Research and Postgraduate Support Directorate 2021
Materias:	Gibrat’s Law firm growth Jovanovic Passive Learning Model firm size SMMEs Social Sciences H
Acceso en línea:	https://doaj.org/article/60e7cf36438740a3a732cb4dad4878b5
Etiquetas:	Agregar Etiqueta Sin Etiquetas, Sea el primero en etiquetar este registro!

id	oai:doaj.org-article:60e7cf36438740a3a732cb4dad4878b5
record_format	dspace
spelling	oai:doaj.org-article:60e7cf36438740a3a732cb4dad4878b52021-11-05T17:34:13ZThe Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa 2663-45972663-4589https://doaj.org/article/60e7cf36438740a3a732cb4dad4878b52021-11-01T00:00:00Zhttps://journals.dut.ac.za/index.php/ajims/article/view/903https://doaj.org/toc/2663-4597https://doaj.org/toc/2663-4589 Previous studies in both developed and developing economies have reported that firm growth declines with firm age and size. However, review of literature showed that there are limited studies to empirically assess the validity of this fact on firm growth in developing countries. As such, the purpose this paper assesses the role of firm size and age on firm growth in KwaZulu Natal, South Africa. The study employed a unique balanced three-year panel dataset of 191 manufacturing Small Medium and Micro Enterprises (SMMEs) in the province. As expected, the results showed negative relationship between firm growth and size especially in the short term. However, contrary to the wider body of literature, the study established a positive relationship between firm age and growth. The study also established that older firms grow faster than their younger counterparts despite their size. On the other hand, small sized firms despite their age grow faster than large firms when employment and total assets were used as measures of firm size. It was recommended that the government should be cognisant of the complexity of SMMEs when crafting various sector policies. Helper ZhouVictor GumboResearch and Postgraduate Support DirectoratearticleGibrat’s Lawfirm growthJovanovic Passive Learning Modelfirm size SMMEsSocial SciencesHENAfrican Journal of Inter-Multidisciplinary Studies, Vol 3, Iss 1 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	Gibrat’s Law firm growth Jovanovic Passive Learning Model firm size SMMEs Social Sciences H
spellingShingle	Gibrat’s Law firm growth Jovanovic Passive Learning Model firm size SMMEs Social Sciences H Helper Zhou Victor Gumbo The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
description	Previous studies in both developed and developing economies have reported that firm growth declines with firm age and size. However, review of literature showed that there are limited studies to empirically assess the validity of this fact on firm growth in developing countries. As such, the purpose this paper assesses the role of firm size and age on firm growth in KwaZulu Natal, South Africa. The study employed a unique balanced three-year panel dataset of 191 manufacturing Small Medium and Micro Enterprises (SMMEs) in the province. As expected, the results showed negative relationship between firm growth and size especially in the short term. However, contrary to the wider body of literature, the study established a positive relationship between firm age and growth. The study also established that older firms grow faster than their younger counterparts despite their size. On the other hand, small sized firms despite their age grow faster than large firms when employment and total assets were used as measures of firm size. It was recommended that the government should be cognisant of the complexity of SMMEs when crafting various sector policies.
format	article
author	Helper Zhou Victor Gumbo
author_facet	Helper Zhou Victor Gumbo
author_sort	Helper Zhou
title	The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
title_short	The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
title_full	The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
title_fullStr	The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
title_full_unstemmed	The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa
title_sort	role of size and age on firm growth: evidence from manufacturing smmes in kwazulu-natal province, south africa
publisher	Research and Postgraduate Support Directorate
publishDate	2021
url	https://doaj.org/article/60e7cf36438740a3a732cb4dad4878b5
work_keys_str_mv	AT helperzhou theroleofsizeandageonfirmgrowthevidencefrommanufacturingsmmesinkwazulunatalprovincesouthafrica AT victorgumbo theroleofsizeandageonfirmgrowthevidencefrommanufacturingsmmesinkwazulunatalprovincesouthafrica AT helperzhou roleofsizeandageonfirmgrowthevidencefrommanufacturingsmmesinkwazulunatalprovincesouthafrica AT victorgumbo roleofsizeandageonfirmgrowthevidencefrommanufacturingsmmesinkwazulunatalprovincesouthafrica
_version_	1718444103749861376

The Role of Size and Age on Firm Growth: Evidence from Manufacturing SMMEs in KwaZulu-Natal Province, South Africa

Ejemplares similares