Small Business Economics

, Volume 44, Issue 1, pp 145–170 | Cite as

High-growth firms in changing competitive environments: the US pharmaceutical industry (1963 to 2002)

  • Mariana MazzucatoEmail author
  • Stuart Parris


Firms across sectors and regions are highly skewed in their ability to engage with innovation and even more skewed in their ability to translate investments in innovation into higher growth. Recent attention has been placed on the importance of ‘high-growth firms’ (HGF) for innovation policy. Our paper explores under what conditions HGF matter for translating R&D investments into economic growth and how this depends on firm-specific and industry-specific factors. We use quantile regression techniques to study the R&D–growth relationship in HGF compared to low-growth firms. Unlike previous studies, we pay particular attention to whether this relationship depends on the particular period in the industry’s life cycle. We focus on the US pharmaceutical industry from 1963 to 2002 and find that the R&D–growth relationship is sensitive to the changing competitive environment over the industry’s history, which suggests that innovation policy must focus not only on firm attributes but also competitive structures.


High-growth firms Research and development Competitive environment Quantile regression Pharmaceutical industry 

JEL Classifications

L22 L25 L26 O30 O32 



The research leading to these results was funded by an INET grant on Financing Innovation (INO1200037).

Supplementary material

11187_2014_9583_MOESM1_ESM.docx (67 kb)
Supplementary material 1 (DOCX 67 kb)


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Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  1. 1.University of SussexBrightonUK
  2. 2.The Open UniversityWalton Hall, Milton KeynesUK

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