Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/317009 
Authors: 
Year of Publication: 
2024
Series/Report no.: 
ETLA Report No. 160
Publisher: 
The Research Institute of the Finnish Economy (ETLA), Helsinki
Abstract (Translated): 
The study examines the relationship between firm size and its management's subjectively perceived growth constraints and financing limitations. Additionally, it explores Finland's business size dynamics and their development from 2008 to 2022. The results indicate that company size transitions are rare, with most businesses remaining in their original size category. However, growth potential is particularly identified in medium-sized and Mittelstand companies. Heavy regulation and administrative obligations are the most commonly reported barriers to growth. Furthermore, up to half of Mittelstand and large companies report growth barriers due to higher cost levels compared to competitors. A more detailed analysis shows that company size, when measured by the number of employees, has only a limited effect on growth barriers. Differences become clearer when measured by revenue, though ownership structure, growth ambition, and industry are also significantly associated with many growth barriers. Small businesses more frequently face constraints related to debt aversion, capacity limitations, sales and marketing challenges, and finding skilled labor. Financial barriers do not vary significantly across company sizes, but larger companies are less frequently hindered by the availability of debt and equity financing for investments compared to smaller businesses.
Subjects: 
Business growth
Growth barriers
Financial constraints
Company size dynamics
Mittelstand companies
JEL: 
L11
L20
L21
L25
L53
D22
Document Type: 
Research Report

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