ABSTRACT
We provide evidence that both human capital and R&D increase the likelihood that a firm will be a high-growth firm in the industry. However, different from human capital, being an R&D active firm also increases the probability of substantial decline or failure, underscoring the risky nature of innovation. Quantile regression results show that, different from R&D, human capital is growth-enhancing for all firms, hence also those located in the lower quantiles of the distribution of growth rates across firms.
Notes
1 Dependent variable is [log(employment2011) − log(employment2008)]/3 with a mean value of −0.011 and a SD of 0.138. Full estimation results, with size and age included and industry dummies and bootstrapped SEs can be obtained upon request from the authors.