high tech firm, dynamics of growth, creation of welfare, EMEA countries
High technologies and the firms that are producing these high technologies play an important role in a creation of welfare. From the last quarter of the last century, we must take into account this…more
High technologies and the firms that are producing these high technologies play an important role in a creation of welfare. From the last quarter of the last century, we must take into account this new element of economies, high tech firms. Several factors are important for their definition, e.g.: a line of business in the scope of high technologies, supernormal rate of highly educated employees (a feature of a knowledge economy), supernormal R&D expenditures, and supernormal dynamics of revenue growth, respectively accounting value added growth. It is necessary to pay attention to isoquant analysis in connection with production function in the short, as well as long terms, to the influence of the investment multiplier effect, and the acceleration effect. In the new development stage of an economy, which is pulled by innovations, as well as for insured competitiveness, it is not enough to use high tech products only. It is necessary to develop the high tech firms in the branch structure that produce these outcomes. This way, it is enabled to reach a steeper production function inclination, which is affected by technical, technological, and economic progress as a basic attribute of the so called long term. The high tech firms are analysed on the basis of data from the representative ranking of 500 firms of the EMEA (i.e. Europe, Middle East, Africa) countries, provided by Deilotte Touche Tohmatsu TMT, from the years 2002-2006. The firms were ranked according to branches - the most numerous is the software“ branch, „the lowest average rank of the firms reaches the „media, entertainment“ branch, the most dynamic revenue growth reaches the „semiconductors, equipment“ branch. According to country, the highest number of the firms in the ranking was represented by the United Kingdom, the lowest average rank of the firms was represented by Portugal, - if we pass over Bulgaria, which is represented by one firm only, the most dynamic revenue growth was reached by the high tech firms of Israel. The high tech firms are an important component of the economic branch structure, which immanently contains the acceleration effect. One question asks, if an economic environment in countries influences their number or growth dynamics. This hypothesis has not been verified. On the contrary, we can see the connection between the dynamics of revenue growth of high tech firms and the dynamics of welfare growth - measured with the GDP indicator, taking into account its absolute level. In the article‘s conclusion, the cluster distribution of the countries is presented according to the selected indicators. It is obvious that four main groups of countries exist; they have a different position in terms of high tech firms and the creation of welfare.