The Economic Contribution of High-Growth Firms: Do Policy Implications Depend on the Choice of Growth Indicator?

Prior studies have defined high-growth firms (HGFs) in terms of growth in firm employment or firm sales, and primarily analyzed their contribution to overall employment growth. In this paper we define HGFs using the commonly applied growth indicators (employment and sales), but also add definitions based on growth in value added and productivity. Our results indicate that HGFs in terms of employment are not the same firms as HGFs in terms of productivity, and that their economic contributions differ significantly. Economic policy promoting fast growth in employment may therefore come at the cost of reduced productivity growth. Although HGFs of different definitions may not be the same firms, young firms are more likely to be HGFs irrespective of definition. This suggests that economic policy should focus on the conditions for new firm formation and early growth of firms, rather than target a particular type of HGFs.     

The Return to Direct Investment in Private Firms: New Evidence on the Private Equity Premium Puzzle*

This paper uses a novel dataset to analyze the return to direct investments in private firms by pension funds. We have two key findings. First, direct investments in private firms have underperformed public equity by 392 basis points per annum under conservative risk adjustments. Second, initial mispricing, due to over‐optimism or misperceived risk, and subsequent low capital gains seem to explain the gap in returns to private firms. Overall, these findings complement the finding of Moskowitz and Vissing‐Jørgensen (2002) of low returns on entrepreneurial investments and provide new insight into the existence of what they call the private equity premium puzzle: Even professional investors with well‐diversified portfolios like pension funds seem to get a poor risk‐return tradeoff from investing directly in private firms.     

An ex ante evaluation of mobile depots in cities: A sustainability perspective

Today, a large share of cost, congestion, and emission in cities is attributed to light goods vehicles like carrier vans distributing to the last mile. The aim of many policy agendas is to reach cleaner cities with less disturbance from the distribution vehicles. Several suggestions have been put forward and tested in research and practice, such as access restrictions, multimodal transport, and use of cleaner vehicles. In this paper, we develop a case for a more sustainable freight distribution within cities using an ex ante case study. The idea of the mobile depot is built on the iteration between historical transitions within cities and contemporary developments in urban freight distribution, and then analyzed ex ante both quantitatively in calculations and qualitatively in two stakeholder workshops. The idea is integrated and multimodal, based on a mobile depot (e.g., a bus, truck, barge, or tram) that circles the city and connects to low emission last mile delivery options such as LEVs (Light Electrical Vehicles) or cargo bikes. We found that such a system can be environmentally and socially better for the city context, while maintaining economic viability above a certain utilization rate of the mobile depot for the transport operators.     

Piggybacking strategies for nonprofits: A shared costs approach

This article presents case data and a conceptual foundation for nonprofit piggybacking whereby a nonprofit organization subsidizes its deficit producing primary mission by diversifying into related surplus-producing ventures. Shared common and joint costs are considered as supply-side bases for selecting among demand-side related diversification activities.     

What can managers do about unethical management?

What can and should we do as managers and administrators when our sense of personal morality is at odds with our organization's behavior? Among the many alternatives are: (1) not think about it; (2) go along and get along; (3) protest; (4) conscientiously object; (5) leave; (6) secretly blow the whistle; (7) publicly blow the whistle; (8) secretly threaten to blow the whistle; (9) sabotage; and, (10) negotiate and build consensus for a change in the unethical behavior. This article considers the advantages and disadvantages of these ten types of strategies based on some philosophy, game theory and everyday pragmatics.