Age, Size, Growth and Survival: UK Companies in the 1980s

Abstract

This paper examines growth and survival amongst quoted and unquoted U.K. companies in the period 1975-85 and compares the results with earlier U.K. and U.S. studies. An examination of death rates shows that smaller companies had higher death rates but the largest and smallest companies were least vulnerable to takeover. Careful attention is, therefore, paid to problems of sample selection bias. It is shown that smaller companies grew faster than larger companies, that Gibrat's law does not hold amongst smaller firms, that age is negatively related to growth, and that these results are not an artifact of sample-selection bias. Copyright 1994 by Blackwell Publishing Ltd.