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Increasing ‘The Vital 6 Percent’: Designing effective public policy to support high growth firms

Nesta Working Paper 14/01
Issued: January 2014
JEL Classification: O38
Keywords: Entrepreneurship, High Growth Firms, Public Policy, UK

Abstract

This paper examines the nature of high growth firms (HGFs) and how they are supported by public policy.

HGFs have become a key focus for public policy within the UK and across many OECD economies in recent years. In parallel with this, there has been a growing body of research and evidence which has accumulated on the nature of these firms.

However, sizeable gaps in our knowledge remain on how these firms operate and grow. To date, very few researchers have attempted to examine the specific nature of the growth processes and their associated growth constraints. As a consequence, a degree of ambiguity and ‘mythology’ is attached to HGFs.

This paper seeks to ‘debunk’ some of the myths associated with these rapidly growing ventures by taking stock of some of the recent research findings. Arguably, a weak understanding of HGFs has manifested itself in the poor policy frameworks which have been devised to support these firms. This paper offers some suggestions for how entrepreneurship and small business policy could be better formulated to help improve the effectiveness of public policy. The paper concludes with some suggestions for future research on high growth entrepreneurship which would further aid policy development in this area.

Authors

Ross Brown, Colin Mason and Suzanne Mawson

The Nesta Working Paper Series is intended to make available early results of research undertaken or supported by Nesta and its partners in order to elicit comments and suggestions for revisions and to encourage discussion and further debate prior to publication (ISSN 2050-9820). The views expressed in this working paper are those of the author(s) and do not necessarily represent those of Nesta.