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Drivers of growth in Tunisia: young firms vs incumbents

Author

Listed:
  • Hassan Arouri

    (National Institute of Statistics, Tunis, Tunisia)

  • Adel Ben Youssef

    (UniCA - Université Côte d'Azur)

  • Francesco Quatraro

    (University of Torino - UNITO - Università degli studi di Torino = University of Turin)

  • Marco Vivarelli

    (Unicatt - Università cattolica del Sacro Cuore [Milano])

Abstract
The aim of this paper is to investigate the growth dynamics of young small firms (in contrast with larger and older incumbents) in a developing country context, using a unique and comprehensive dataset of non-agricultural Tunisian companies. Our results suggest that significant differences between young and mature firms can be found as far as the drivers of their growth are concerned. The key finding being that—while consistently with the extant literature Gibrat’s law is overall rejected—the negative impact of the initial size is significantly larger for young than mature firms. This result has interesting policy implications: since smaller young firms are particularly conducive to employment generation, they can be considered good candidate for targeted accompanying policies addressed to sustain their post-entry growth.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Hassan Arouri & Adel Ben Youssef & Francesco Quatraro & Marco Vivarelli, 2020. "Drivers of growth in Tunisia: young firms vs incumbents," Post-Print halshs-03506870, HAL.
    • Handle: RePEc:hal:journl:halshs-03506870
    DOI: 10.1007/s11187-018-00133-6
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    2. Marco Guerzoni & Luigi Riso & Marco Vivarelli, 2023. "The Law of Proportionate Effect: A test based on the graphical model methodology," Working Papers 514, University of Milano-Bicocca, Department of Economics.
    3. Julie Ann Elston & Alois Weidinger, 2023. "An empirical examination of firm growth in the MENA region through the lens of Gibrat’s law," Small Business Economics, Springer, vol. 60(1), pages 121-131, January.
    4. Florian Léon, 2020. "Firm growth in developing countries: Driven by external shocks or internal characteristics?," Working Papers hal-03004383, HAL.
    5. Wadho, Waqar & Goedhuys, Micheline & Chaudry, Azam, 2019. "Do young innovative companies create more jobs? Evidence from Pakistani textile firms," MERIT Working Papers 2019-002, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    6. Wadho, Waqar & Goedhuys, Micheline & Chaudhry, Azam, 2019. "Young innovative companies and employment creation, evidence from the Pakistani textiles sector," World Development, Elsevier, vol. 117(C), pages 139-152.

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    More about this item

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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