Abstract
Recent work drawing on data for large and small firms has shown a Pareto distribution of firm size. We begin by showing that the firm age distribution is well approximated by an exponential distribution. We then mix a Gibrat-type growth process among incumbents with an exponential distribution of firm's age, to obtain the empirically-observed Pareto distribution.
| Original language | English |
|---|---|
| Pages (from-to) | 389-395 |
| Number of pages | 7 |
| Journal | Journal of Industry, Competition and Trade |
| Volume | 10 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2010 |
| Externally published | Yes |
Keywords
- Gibrat's law
- Pareto distribution
- Zipf Law
- age distribution
- firm growth
- firm size distribution
ASJC Scopus subject areas
- Industrial relations