Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia

High-growth firms have been widely studied in advanced countries, but little is known about such stellar performers in Africa. Using establishment-level data from Ethiopia, this paper finds that the incidence of high-growth firms stands at an avera...

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Main Author:	Grover, Arti
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2020
Subjects:	FIRM PRODUCTIVITY AGGLOMERATION ECONOMICS SMALL AND MEDIUM ENTERPRISES HIGH-GROWTH FIRMS
Online Access:	http://documents.worldbank.org/curated/en/600161577764526811/Firms-Far-Up-Productivity-Agglomeration-and-High-Growth-Firms-in-Ethiopia http://hdl.handle.net/10986/33119

id	okr-10986-33119
recordtype	oai_dc
spelling	okr-10986-331192022-09-20T00:14:24Z Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia Grover, Arti FIRM PRODUCTIVITY AGGLOMERATION ECONOMICS SMALL AND MEDIUM ENTERPRISES HIGH-GROWTH FIRMS High-growth firms have been widely studied in advanced countries, but little is known about such stellar performers in Africa. Using establishment-level data from Ethiopia, this paper finds that the incidence of high-growth firms stands at an average of 7 percent, a figure comparable to that of advanced countries. High-growth episodes are short-lived, and the likelihood of survival or a subsequent episode is not any higher for high-growth firms. It is difficult for firms to sustain high growth, and the likelihood of a repeated episode is low. There is only a 6.5 percent chance that a manufacturing plant in Ethiopia will repeat a high-growth event in the subsequent three-year period. This likelihood is not greater than that of plants that did not experience high growth in the previous period. The paper explores the drivers of high growth and finds a tight link between exemplary performance and initial plant productivity, which is robust to many controls, including plant location. Plants located in Ethiopia's capital city or agglomerations have a higher probability of high growth. And high growth in plant employment is found to be self-reinforcing, that is, past high-growth experience is positively and significantly associated with subsequent growth in firm productivity. 2020-01-02T21:45:58Z 2020-01-02T21:45:58Z 2019-12 Working Paper http://documents.worldbank.org/curated/en/600161577764526811/Firms-Far-Up-Productivity-Agglomeration-and-High-Growth-Firms-in-Ethiopia http://hdl.handle.net/10986/33119 English Policy Research Working Paper;No. 9099 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa Ethiopia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	FIRM PRODUCTIVITY AGGLOMERATION ECONOMICS SMALL AND MEDIUM ENTERPRISES HIGH-GROWTH FIRMS
spellingShingle	FIRM PRODUCTIVITY AGGLOMERATION ECONOMICS SMALL AND MEDIUM ENTERPRISES HIGH-GROWTH FIRMS Grover, Arti Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
geographic_facet	Africa Ethiopia
relation	Policy Research Working Paper;No. 9099
description	High-growth firms have been widely studied in advanced countries, but little is known about such stellar performers in Africa. Using establishment-level data from Ethiopia, this paper finds that the incidence of high-growth firms stands at an average of 7 percent, a figure comparable to that of advanced countries. High-growth episodes are short-lived, and the likelihood of survival or a subsequent episode is not any higher for high-growth firms. It is difficult for firms to sustain high growth, and the likelihood of a repeated episode is low. There is only a 6.5 percent chance that a manufacturing plant in Ethiopia will repeat a high-growth event in the subsequent three-year period. This likelihood is not greater than that of plants that did not experience high growth in the previous period. The paper explores the drivers of high growth and finds a tight link between exemplary performance and initial plant productivity, which is robust to many controls, including plant location. Plants located in Ethiopia's capital city or agglomerations have a higher probability of high growth. And high growth in plant employment is found to be self-reinforcing, that is, past high-growth experience is positively and significantly associated with subsequent growth in firm productivity.
format	Working Paper
author	Grover, Arti
author_facet	Grover, Arti
author_sort	Grover, Arti
title	Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
title_short	Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
title_full	Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
title_fullStr	Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
title_full_unstemmed	Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia
title_sort	firms far up! productivity, agglomeration and high-growth firms in ethiopia
publisher	World Bank, Washington, DC
publishDate	2020
url	http://documents.worldbank.org/curated/en/600161577764526811/Firms-Far-Up-Productivity-Agglomeration-and-High-Growth-Firms-in-Ethiopia http://hdl.handle.net/10986/33119
_version_	1764478041321373696

Firms Far Up! Productivity, Agglomeration and High-Growth Firms in Ethiopia

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