TY - JOUR
T1 - Inter-firm rivalry and firm growth
T2 - Is there any evidence of direct competition between firms?
AU - Coad, Alex
AU - Teruel, Mercedes
N1 - Funding Information:
We are very much indebted to Harald Oberhofer and Michael Pfaffermayr for invaluable help with the peer-effects econometrics, and also to Rob Byrne, Tim Hazledine, Mike Hopkins, Mikael Juselius, Alessio Moneta, Jan-Willem Stoelhorst, David Storey, Nick von Tunzelmann, and participants at the Ratio Institute workshop on “Understanding firm growth” (Stockholm, August 12–13, 2010), the ZEW conference on “Quantitative analysis in competition assessments” (Mannheim, October 21–22, 2010), EAEPE 2011 (Vienna), ENEF 2011 (Strasbourg), and seminar participants at the Max Planck Institute of Economics (Jena, Germany) and at Alcalá de Henares for helpful discussions. Alex Coad gratefully acknowledges financial support from the ESRC, TSB, BIS and NESTA on grants ES/H008705/1 and ES/ J008427/1 as part of the IRC distributed projects initiative, as well as from the AHRC as part of the FUSE project. Mercedes Teruel gratefully acknowledges financial support of the Spanish Ministry of Innovation and Science in the project ECO2009-08735 and the Consolidated Group of Research 2009-SGR-907. The usual disclaimer applies.
PY - 2013/4
Y1 - 2013/4
N2 - Inter-firm competition has received much attention in the theoretical literature, but recent empirical work suggests that the growth rates of rival firms are uncorrelated. We begin by investigating the correlations of the growth rates of competing firms (i.e. the largest and second-largest firms in the same industry) and observe that, surprisingly, the growth of these firms can be taken as uncorrelated. Nevertheless, peer-effect regressions, that take into account the simultaneous interdependence of growth rates of rival firms, are able to identify significant negative effects of rivals' growth on a firm's growth
AB - Inter-firm competition has received much attention in the theoretical literature, but recent empirical work suggests that the growth rates of rival firms are uncorrelated. We begin by investigating the correlations of the growth rates of competing firms (i.e. the largest and second-largest firms in the same industry) and observe that, surprisingly, the growth of these firms can be taken as uncorrelated. Nevertheless, peer-effect regressions, that take into account the simultaneous interdependence of growth rates of rival firms, are able to identify significant negative effects of rivals' growth on a firm's growth
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U2 - 10.1093/icc/dts018
DO - 10.1093/icc/dts018
M3 - Article
AN - SCOPUS:84875589695
SN - 0960-6491
VL - 22
SP - 397
EP - 425
JO - Industrial and Corporate Change
JF - Industrial and Corporate Change
IS - 2
ER -