Persistent high-growth firms in China's manufacturing

This article explores the association between persistence of high-growth and crucial dimensions of firm structure and performance (productivity, profits, investment patterns, innovation, and financial structures) to shed light on what makes a persistent high-growth firm. We employ a multidimensional definition of a high-growth firm that simultaneously accounts for growth of sales and employment, and design an empirical strategy that seeks to capture the “long-run” ability of high-growth firms to replicate their high-growth performance over time. Exploiting a large panel covering the period of the China’s miracle, we find that none of the considered firm attributes stands out as distinctive feature of persistent high-growth. This finding casts doubts on the long-run contribution of high-growth firms, in turn challenging the long-run effectiveness of policies supporting the creation and expansion of such firms.