infonet-economy

One of the most controversial issues in the growth literature is whether there is an optimal growth rate that maximizes firm performance. Contrary to prior research, we argue that optimum growth rates are firm-specific and, as such, cannot be established across whole populations of firms. Drawing on multiple bodies of related literature, we develop a model of optimum firm growth consisting of managerial, financial, and market thresholds. Our research suggests that there are firm-specific corridors of optimum growth and that they may have a significant effect on firms' long term-performance.