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Determinants of growth of European SMEs
Pastva, Richard ; Babin, Jan (advisor) ; Kadeřábková, Božena (referee)
The subject of this thesis is an analysis of factors influencing the growth rate of small and medium enterprises in Europe. The required data was collected from Amadeus database and processed into a panel dataset. Afterwards, the regression parameters of the selected explanatory variables were obtained by means of fixed effects models. Results showed that enterprise growth rate was most significantly influenced by the rate of R&D costs, specifically its annual change in relation to turnover. Growth is also positively influenced by firm's profitability, annual change in intangible assets value and nation's growth rate of GDP. A negative effect on growth connected with solvency ratio was also found, which is consistent with a proposition of the pecking order theory. Once again, validity of Gibrat's Law was confirmed when size variable turned out to be statistically insignificant and slightly negative in addition. Not surprisingly, privately held companies operating in Western Europe showed a bit higher propensity to faster growth than their counterparts.

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