The uniqueness of firm size distribution function from tent-shaped growth rate distribution
AbstractEmploying profits data of Japanese firms in 2003 and 2004, we report the proof that a Non-Gibrat's law in the middle scale region of profits is unique under the law of detailed balance. This uniquely leads to the probability distribution function (pdf) of profits. In the proof, two approximations are employed. The pdf of growth rate is described as tent-shaped exponential functions and the value of the origin of the growth rate distribution is constant. These approximations are confirmed in the database. The resultant profits pdf fits with the empirical data consistently. This guarantees the validity of the approximations.
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Bibliographic InfoArticle provided by Elsevier in its journal Physica A: Statistical Mechanics and its Applications.
Volume (Year): 383 (2007)
Issue (Month): 1 ()
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Web page: http://www.journals.elsevier.com/physica-a-statistical-mechpplications/
Econophysics; Pareto's law; Non-Gibrat's law; Detailed balance; Profits distribution;
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- Ishikawa, Atushi, 2008. "Power-Law and Log-Normal Distributions in Firm Size Displacement Data," Economics Discussion Papers 2008-45, Kiel Institute for the World Economy.
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