To Grow or Not to Grow? That Is the Question: Lessons for Social Ecological Transformation from Small-Medium Enterprises

Why do firms grow? Do they need to? Why do they want to? Why do some refuse to? In the context of post-growth research this paper investigates mechanisms that lead to the growth of small and medium sized enterprises and explores the non-growth option.

While research on alternatives to growth at the level of the economy as a whole is accumulating, few studies have related the criticism of growth to the business level. This paper starts to address this gap by investigating mechanisms of growth for small and medium sized enterprises (SMEs), presenting a case study that applies Q methodology and interviews with owner-managers of both growing and non-growing SMEs in Austria. General mechanisms stimulating growth are identified (e. g., contributing to innovativeness and motivation of employees) and differentiated from those only of relevance for some SMEs: competition, financial stability, and a desire for market power. The owner-managers of non-growing SMEs hold values and pursue goals that free them from mechanisms of growth or prevent them from being triggered. Moreover, they exhibit a strong identification with their SME, operate in niche markets and strive for financial independence. This illustrates that a growth imperative is neither inevitable nor are growth mechanisms always operative, but depend upon structures and institutions.