Dias, C; King, M (2023) Growth and Survival of Supported Firms. NPL Report. IEA 13

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Abstract

NPL’s direct economic impact is positively related on the number of UK-based firms that regularly use its measurement services, or that collaborate with its scientists; where the firms’ use of services or their engagement in collaboration are to be counted as instances of “support” from NPL to these firms. The approach taken in this study is motivated by the findings of an independent analysis, done by consultants from Belmana (entitled ‘Public Support for Innovation and Business Outcomes’), according to which firms who regularly pay for NPL’s measurement services, or that collaborate with its scientists, saw statistically significant wage and employment growth. This study follows on from Belmana’s analysis and details the development of a metric based on counting the number of "regularly supported" firms, defined as those who’d worked with NPL five (or more) times during a six-year period. A couple of supplementary metrics have also been created, counting the number of firms who “sometimes” or “occasionally” receive support from NPL.

Over a long period of time, it’s natural for firms to "transition" from one type of status (e.g., being "unknown to NPL") to another type of status (e.g., being “regularly supported”). Thus, assessing the dynamics of this flow is one of the many analytical uses of this metric and the underlying data. Although our analysis focussed on finding correlations, it confirmed that regularly supported firms tend to perform better than those that have stopped being supported, where “performance” is judged based on the firms’ survival and growth. Lastly, enhanced performance among the supported firms seems to scale positively with the regularity of the support being received by a given firm (more support, lower probability of death, and higher probability of growth).

Item Type:	Report/Guide (NPL Report)
NPL Report No.:	IEA 13
Divisions:	Strategy Directorate
Identification number/DOI:	10.47120/npl.IEA13
Last Modified:	21 Aug 2024 10:01
URI:	https://eprintspublications.npl.co.uk/id/eprint/9634