Abstract

This study examines whether early growth is important for the short- and long-term survival and development of new firms. For this purpose, we use registry data for a specific cohort of Swedish firms that tracks their development until their exit, or up to 14 years, at which point only 8% of the firms remain. We find growth to be clearly associated with increased survival of the firms, that the number of employees (in the previous year) is positively correlated with survival in following years, and somewhat surprisingly, that subsidiaries face a significantly larger hazard of closure than independent firms.

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