The nexus between firm size, growth and profitability: new panel data evidence from Asia–Pacific markets

Purpose The purpose of this paper is to examine the correlation between firm size, growth and profitability along with other firm-specific variables (like leverage, competition asset tangibility), macroeconomic variable GDP growth-business cycle) stock market development MCR). Design/methodology/approach Using COMPUSTAT Global database work uses panel dynamic fixed effects model for nearly 12,001 unique non-financial listed active firms from 1995 2016 12 industrial emerging Asia–Pacific economies. This interrelationship was also examined small, medium large size companies classified based on three alternate measures such as total assets, net sales MCR firms. Findings persistence profits coefficient found be positive modest. There evidence a negative size-profitability growth-profitability relationship suggesting that initially increases but eventually, overtime, gains in profit rates reduce, indicting breeds inefficiency. firm's leverage ratio its tangibility profitability. business cycle suggest However, significance estimated coefficients mixed varied among different selected Practical implications study has economic issues concentration, risk optimum practicing managers modern enterprise markets. Originality/value analysis uniquely determined under framework using financial determinants new data set