New Publication Alert: Big Challenges for Small Firms
- Laura Freschi
- Nov 28, 2025
- 1 min read
We’re pleased to share the release of a new Small Firm Diaries issue brief, “Big Challenges for Small Firms,” by Laura Freschi, Timothy Ogden, and Jonathan Morduch.
Drawing on high-frequency data from small firms, the brief documents how volatility shapes day-to-day decision-making. Week-to-week fluctuations in revenue and liquidity influence choices on hiring, investment, and risk in ways that are often invisible in standard datasets.
Rather than framing small firms as uniformly growth-oriented, our analysis highlights how stability is frequently the binding constraint. Many decisions that appear, from the outside, to reflect underinvestment or limited ambition are better understood as rational responses to uncertainty.
The brief has implications for research, policy, and practice, particularly for efforts that aim to support small firms without accounting for the realities of cash-flow volatility.
The full publication is available here:
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