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Secular stagnation on the supply side takes the form of a slow 1.6 percent annual growth rate of US potential real GDP, roughly half the 3.1 percent annual growth rate of actual real GDP realized from 1972 to 2004. This slowdown stems from a sharp decline in the growth rate of aggregate hours of work and of output per hour. This paper attributes the productivity growth decline to diminishing returns in the digital revolution that had its peak effect business hardware, software, and best practices in the late 1990s but has resulted in little change in those methods over the past decade.

This paper shows that employment in cohorts of US firms is strongly influenced by aggregate conditions at the time of their entry. Employment fluctuations of startups are procyclical, they persist into later years, and cohort-level employment variations are largely driven by differences in firm size, rather than the number of firms. An estimated general equilibrium firm dynamics model reveals that aggregate conditions at birth, rather than post-entry choices, drive the majority of cohort-level employment variation by affecting the share of startups with high growth potential. In the aggregate, changes in startup conditions result in large, slow-moving fluctuations in employment.

This article connects two strands of the literature on social trust by directly estimating the effects of trust on growth through a set of potential transmission mechanisms. It does so by modeling the process using a 3SLS estimator on a sample of 85 countries for which a full data set is available. The results indicate that trust affects schooling and the rule of law directly, thereby raising economic growth rates. The article closes with a short discussion of the relevance of the findings.

Studies on the impact of technological innovation on growth have been largely mute on the role of new firm formation. Using cross-sectional data on the 37 countries participating in GEM 2002, this paper uses an augmented Cobb-Douglas production to explore firm formation and technological innovation as separate determinants of growth. One area of interest is the contrast between different types of entrepreneurial activities as measured using GEM Total Entrepreneurial Activity (TEA) rates - high growth potential TEA, necessity TEA, opportunity TEA and overall TEA. Of the four types of entrepreneurship, only high growth potential entrepreneurship is found to have a significant impact on economic growth. This finding is consistent with extant findings in the literature that it is fast growing new firms, not new firms in general, that accounted for most of the new job creation by small and medium enterprises in advanced countries.

High-growth firms are seen as vital for economic growth. It is important for policy and theory to consider the barriers faced by firms achieving high growth and those with the potential to do so. This article uses data for 4,858 UK SMEs to investigate the obstacles perceived by two sets of firms: (1) firms in periods of high growth and (2) potential high-growth firms, which are observationally similar but are not achieving high growth. The results suggest high-growth firms perceive problems in six areas: recruitment, skill shortages, obtaining finance, cash flow, management skills and finding suitable premises. Potential high-growth firms feel held back by the economy, obtaining finance, cash flow and their management skills, but are less likely to perceive regulation is a problem. The results have implications for theory on high-growth firms and policies focussed at them.

The performance implications of family ownership have been studied extensively. However, studies that investigate the influence of family ownership on small business growth remain scarce and suffer from several shortcomings. To remedy these shortcomings, this paper uses a very large sample of French SMEs to explore the relationship between family ownership and small business growth. First, this study shows that there is a negative, although nonmonotonic, relationship between family ownership and small business economic growth. Second, it explores the channel through which family ownership affects firm growth. Results suggest that firms with greater family ownership are prone to below-potential rates of economic growth, given their internal financing resources. Overall, the results suggest that small family businesses have a propensity to deliberately limit their growth (i.e., they adopt conservative growth behavior).

New research using data spanning centuries reveals the presence of very large energy efficiency rebound magnitudes, calling into question the energy use forecasts relied on by international bodies investigating climate change mitigation policy. This article uses those recent results to highlight and explain the key drivers that future energy modelers need to incorporate.

In recent years, the expanding concern of environmental, innovative, and sustainable development has advanced sustainable entrepreneurship. Hence, sustainable innovative entrepreneurship can be considered as a running space for business development, auditing, data analytics, and validation practices with modern, positive, and competitive initiatives. The main aim of this paper was to consider the role of Pearson's p as a quality measure initiative on sustainable entrepreneurship growth dynamics, reflecting the strength in and direction of the linear relationship between the corporate's EBIT profit and several quality corporate factors related to the sustainable growth potential with a positive outlook. A new p-based empirical econometric model was proposed, tested on a Western Balkans case study, and validated. Applications and implications of the model are considered in the context of corporate sustainable profitability with a social footprint.

This paper is an introduction to the present special issue dedicated to scientific research using data collected as part of the Global Entrepreneurship Monitor (GEM) and considering new venture creation as the hall-mark of entrepreneurship. After a short description of GEM's theoretical and methodological background, this introduction highlights the main results of seven papers which were presented at the First GEM Research Conference in Berlin from 1 to 3 April 2004. First, there is empirical evidence that the role of entrepreneurial activity differs across the stages of economic development, in that there appears to be a U-shaped relationship between the level of development and the rate of entrepreneurship. Consequently, a positive effect of entrepreneurial activity on economic growth is found for highly developed countries but a negative effect for developing nations. Second, it is shown that different types of entrepreneurship may have a different impact on a nation's innovativeness and economic growth rate. In particular, potentially high-growth business startups and so-called opportunity entrepreneurship enhance knowledge spillovers and economic growth. Third, entrepreneurship is again shown to be a regional event that can only be understood if regional framework conditions, including networks and regional policies, are taken into consideration.

This paper argues that the European Union (EU) has gone further than any other country or institution in internalising the prescriptions of the Washington Consensus. Embedding neoliberal principles in the treaties defining its governance, the EU has enshrined a peculiar doctrine within its constitution. We further argue that this 'Berlin—Washington Consensus' has serious empirical and theoretical flaws, as its reliance on Pareto optimality leads to neglect the crucial links between current and potential growth. We show by means of a simple model that the call for structural reforms as an engine for growth may be controversial, once current and potential output are related. We claim that adherence to the Consensus may go a long way in explaining the poor growth performance of the European economy in the past two decades, because of the constraints that it imposed on fiscal and monetary policies. The same constraints have deepened the eurozone crisis that started in 2009, putting unwarranted emphasis on austerity and reform. Challenging the Consensus becomes a precondition for avoiding the implosion of the euro and recovering growth.