Small Business Economics

, Volume 16, Issue 4, pp 293–302

A Panel Study of Firm Growth among SMEs in Networks

  • Pers-Anders Havnes
  • Knut Senneseth

DOI: 10.1023/A:1011100510643

Cite this article as:
Havnes, PA. & Senneseth, K. Small Business Economics (2001) 16: 293. doi:10.1023/A:1011100510643


An underlying assumption in SME literature, as well as among policymakers, is that networks are good per se especially for SMEs. Through accessing and utilising external resources in the network, the SME can overcome some of the assumed disadvantages of limited size. Thus networking is assumed to enhance small firm performance and thereby small firm growth. This article investigates this assumption. Analysis of panel data ascertains that a substantial number of SMEs are actively networking and that the level of networking has been maintained over a five-year period. In spite of this there is no evidence of associated short-term benefits such as growth in employment or growth in total sales resulting from the networking activities. The analyses suggest, however, that networking is associated with high growth in the geographic extension of markets, which suggests that networking sustains long-term objectives of the firms.

Copyright information

© Kluwer Academic Publishers 2001

Authors and Affiliations

  • Pers-Anders Havnes
    • 1
  • Knut Senneseth
    • 2
  1. 1.Agder Research FoundationKristiansandNorway
  2. 2.Department of Research on Economic DevelopmentThe Research Council of NorwayOsloNorway