AN EMPIRICAL INVESTIGATION OF THE IMPACT OF LUCK ON SMALL BUSINESS PERFORMANCE: DYNAMIC PANEL DATA EVIDENCE

Luck is a critical variable in small business strategy. However, there is little empirical evidence about the role of luck. This study responded to calls for empirical research using nonstandard statistical techniques to probe the dynamic trajectory of luck on firm performance. We analyze six-year annual panel data, elicited from eleven small business owner/managers. We use the Generalized Method of Moments, GMM-Systems, econometric technique. The results provide statistically significant empirical evidence suggesting that Luck was a determinant of small business economic performance. In previous research, luck was not found to be a significant determinant of firm performance. However, previous performance was found to be a significant determinant of the current level of small business performance.