Matthew S. Bothner
This article examines the effect of relative size on rates of firm growth. Although a number of prior studies have sought to pinpoint the effect of firm size on future growth, such efforts have been focused almost exclusively on absolute size, thereby neglecting the ways in which a firm’s scale advantages with respect to its competitors may independently determine its performance. This study extends recent work in network analysis, strategy and organizational ecology by developing a localized measure of relative size and showing that relative size has a strong positive effect on future growth, net of absolute size. Implications for future research are discussed.