000 02391namaa2200385uu 4500
001 doab72854
003 oapen
005 20260305123947.0
006 m o d
007 cr|mn|---annan
008 211117s2021 xx |||||o ||| 0|eng d
020 _a/doi.org/10.2867/20387
020 _a9789286150500
024 7 _ahttps://doi.org/10.2867/20387
_2doi
040 _aoapen
_coapen
041 0 _aeng
042 _adc
072 7 _aKC
_2bicssc
720 1 _aEuropean Investment Bank
_4aut
245 0 0 _aEIB Working Paper 2021/08 - Do capacity constraints trigger high growth for enterprises?
260 _bEuropean Investment Bank
_c2021
300 _a1 online resource
336 _atext
_btxt
_2rdacontent
337 _acomputer
_bc
_2rdamedia
338 _aonline resource
_bcr
_2rdacarrier
506 0 _aFree-to-read
_fUnrestricted online access
_2star
520 _aHigh-Growth Enterprises have a large economic impact, but it is notoriously hard to predict when firms will experience episodes of high growth. This paper proposes that firms reaching critically high capacity utilisation levels reach a 'trigger point' involving either broad-based investment in further growth, or shrinking back to previous levels. It analyses EIBIS survey data (matched to the ORBIS database) which features a question on time-varying capacity utilisation. Overcapacity is a transitory state. Firms enter into overcapacity after a period of rapid growth of sales and profits, and the years surrounding overcapacity have higher employment growth rates. Firms operating at overcapacity make incremental investments (e.g. capacity expansion, process improvements, and modern machinery) rather than investing in R&D and new product development. The analysis finds support for the 'fork in the road' hypothesis: for some firms, overcapacity is associated with launching into massive investments and subsequent sales growth, while for other firms, overcapacity is negatively related to both investments and sales growth.
540 _aAll rights reserved
_uhttp://oapen.org/content/about-rights
546 _aEnglish
650 7 _aEconomics
_2bicssc
653 _aBusiness & Economics
653 _aFree Enterprise & Capitalism
793 0 _aDOAB Library.
856 4 0 _uhttps://directory.doabooks.org/handle/20.500.12854/72854
_70
_zFree-to-read: DOAB: description of the publication
999 _c92771
_d92771