publication . Article . 2016

Testing relationships between firm size and perceptions of growth and profitability: An investigation into the practices of Australian ICT SMEs

Áron Perényi; Andrey Yukhanaev;
Open Access English
  • Published: 01 Sep 2016
  • Publisher: Cambridge University Press
  • Country: United Kingdom
Abstract
<jats:title>Abstract</jats:title><jats:p>Gibrat’s Law mandates the independence of firm size and growth, while the resource-based view of the firm implies a positive relationship between firm size and profits, to be concluded in a profit–growth trade-off. Empirical studies of entrepreneurial success however, have demonstrated firms’ ability to reach a state of high growth and profitability, despite the trade-offs encapsulated within the profit–growth nexus. Upon assessing the relationships between past profitability, current firm growth and size in Australian ICT SMEs, results demonstrate positive relationships between all three indicators. This suggests that pr...
Subjects
free text keywords: N100, Business and International Management, Organizational Behavior and Human Resource Management, Organizational performance, Firm offer, Nexus (standard), Industrial organization, Profit (economics), Profitability index, Management, Empirical research, Entrepreneurship, Sociology, Information and Communications Technology
Related Organizations

p = 0.003; χ2 = 48.005; df = 24; GFI = 0.934; AGFI = 0.875; NFI = 0.910; TLI = 0.928; CFI = 0.952 RMSEA = 0.085 [0.049; 0.119]; RMR = 0.078; SRMR = 0.0766; Bollen-Stine bootstrap p = 0.132 All item loadings are significant at p < 0.001 level.

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