On firm growth and innovation: Some new empirical perspectives using French CIS (1992–2004)

• We empirically model the growth innovation relationship.
• We constructed an unbalanced data set with CIS data (1992–2004).
• We test the impact of product innovation versus process innovation on firm growth rates.
• We use different models to estimate a variant of the Gibrat law.
• Firms that are innovative register the higher growth rates compared to non-innovative firms.

The aim of this paper is to examine whether firms that innovate, experience higher rates of growth than firms that do not. Our analysis is based on different models and econometric methodologies applied to several waves the Community Innovation Surveys (CIS) for French industry, during 1992–2004. Our main findings are that innovative firms grow more than non-innovative ones. The estimation techniques give results that are quite robust to the effects of different types of innovation on firm growth. In particular, the quantile regression results show that the coefficient of innovation is higher for firms with the highest growth rates, a result that is robust to different measures of the dependent variable.