Are high-growth firms one-hit wonders?

PublikationArtikel (med peer review)
Daniel Halvarsson, Företagandets villkor, Gaseller, High-growth firms, Persistence, Sven-Olov Daunfeldt, Transition Probabilities


Most firms do not grow, and a small number of high-growth firms seem to create most new jobs. These firms have therefore received increasing attention among policymakers. The question is whether high-growth tends to persist? We investigate this question using data on 432,689 observations in Sweden during 1998-2008. We find that high-growth firms had declining growth rates in the previous 3-year period, and their probability of repeating high growth rates was very low. HGFs are essentially one-hit wonders, and it is thus doubtful whether policymakers can improve economic outcomes by targeting them.

Related content: Working Paper No. 197

Daunfeldt, S-O. & Halvarsson, D. (2015). Are high-growth firms one-hit wonders? Evidence from Sweden. Small Business Economics, 44(2), 361-383. DOI: 10.1007/s11187-014-9599-8

Liknande innehåll

Amundsen versus Scott: are growth paths related to firm performance?
Artikel (med peer review)Publikation
Coad, A., Daunfeldt, SO. & Halvarsson, D.


Publicerat i

Small Business Economics 59, 593–610 (2022).


In the race to the South Pole, Roald Amundsen’s expedition covered an equal distance each day, irrespective of weather conditions, while Scott’s pace was erratic. Amundsen won the race and returned without loss of life, while Scott and his men died. In the context of firm growth, the Amundsen hypothesis suggests that smoother growth paths are associated with better performance in subsequent periods. We develop a new method to investigate how firms’ sales growth deviates from their long-run average growth path. Our baseline results suggest that growth path volatility is associated with higher growth of sales and profits, but also with higher exit rates. However, this result is driven by firms with negative growth rates. For positive-growth firms, volatility is negatively associated with both sales growth and survival, providing nuanced support for the Amundsen hypothesis.

The article can be accessed here.

Do Targeted R&D Grants toward SMEs Increase Employment and Demand for High Human Capital Workers?
Daunfeldt, S. O., Halvarsson, D., Tingvall, P. G., & McKelvie, A.


Publicerat i



Most previous studies on the employment effects of government R&D grants targeting SMEs are characterized by data-, measurement-, and selection problems, making it difficult to construct a relevant control group of firms that did not receive an R&D grant. We investigate the effects on employment and firm-level demand for high human capital workers of two Swedish programs targeted toward growth-oriented SMEs using Coarsened Exact Matching. Our most striking result is the absence of any statistically significant effects. We find no robust evidence that the targeted R&D grant programs had any positive and statistically significant effects on the number of employees recruited into these SMEs, or that the grants are associated with an increase in the demand for high human capital workers. The lack of statistically significant findings is troublesome considering that government support programs require a positive impact to cover the administrative costs associated with these programs.

The book can be downloaded here for free.

Ratio Working Paper No. 361: Bargaining for Trade: When Exporting Becomes Detrimental for Female Wages
Working paperPublikation
Halvarsson, D., Lark, O., Tingvall, P. & Videnord, J.


Publicerat i

Ratio Working Paper series


In this paper we study the link between globalization of firms and gender inequality. Specifically, we examine how the need for interpersonal contacts in trade and gender-specific differences in negotiations are related to the gender wage gap. Our key finding is that export of goods that are intensive in interpersonal contacts widens the gender wage gap. The effect is robust across various specifications and is most pronounced for domestic exporting firms, which do not trade within multinational corporations but with external foreign partners, where the contracting problem is most distinct. We ascribe this result to a male comparative advantage in bargaining.

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