Uncertainty and growth of the firm

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Abstract

Using data from a survey of 1,097 small and medium-sized non-listed Dutch firms we investigate the relation between growth of the firm and uncertainty. We focus on the impact of sales uncertainty on various types of investment. We find that sales uncertainty, measured by the conditional variance, has a mixed impact on various investment decisions. We include an analysis of the relevance of financial structure and firm size on the growth-uncertainty relation.

Original languageEnglish
Pages (from-to)381-391
Number of pages11
JournalSmall Business Economics
Volume24
Issue number4
DOIs
Publication statusPublished - May-2005

Keywords

  • firm size
  • uncertainty
  • gibrats law
  • firm investment
  • INVESTMENT
  • IRREVERSIBILITY
  • INDUSTRY

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