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Technology and the Size Distribution of Firms: Evidence from Dutch Manufacturing

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  • Orietta Marsili

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    Abstract

    Empirical studies have shown that the size distribution of firms can be described as a Pareto distribution. However, these studies have focused on large firms and aggregate statistics. Little attention has been placed on the role of technology in shaping firm size distributions. Using a comprehensive dataset of manufacturing firms and the Community Innovation Survey from the Netherlands, the paper investigates the relationship between firm size and technology. It shows that technological factors shape the distribution of firm size, suggesting that the Pareto law is not an invariant property and that technology can constrain the “self-organising” character of industrial economies. Copyright Springer 2005

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    File URL: http://hdl.handle.net/10.1007/s11151-005-5053-z
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    Bibliographic Info

    Article provided by Springer in its journal Review of Industrial Organization.

    Volume (Year): 27 (2005)
    Issue (Month): 4 (December)
    Pages: 303-328

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    Handle: RePEc:kap:revind:v:27:y:2005:i:4:p:303-328

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    Web page: http://www.springerlink.com/link.asp?id=100336

    Related research

    Keywords: firm size; Gibrat’s law; innovation; Pareto distribution; L11; L60; O33;

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    1. Cohen, Wesley M. & Levin, Richard C., 1989. "Empirical studies of innovation and market structure," Handbook of Industrial Organization, Elsevier, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 18, pages 1059-1107 Elsevier.
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    Cited by:
    1. Y. Malevergne & D. Sornette, 2007. "A two-Factor Asset Pricing Model and the Fat Tail Distribution of Firm Sizes," Papers physics/0702027, arXiv.org.
    2. Ram�n Rufín & Cayetano Medina, 2008. "Market delimitation, firm survival and growth in service industries," The Service Industries Journal, Taylor & Francis Journals, vol. 30(9), pages 1401-1417, September.
    3. Jakub Growiec & Fabio Pammolli & Massimo Riccaboni, 2011. "Innovation and Corporate Dynamics: A Theoretical Framework," DISA Working Papers, Department of Computer and Management Sciences, University of Trento, Italy 2011/08, Department of Computer and Management Sciences, University of Trento, Italy, revised 29 Jul 2011.
    4. Alex Coad & Werner Hölzl, 2009. "On the Autocorrelation of Growth Rates," Journal of Industry, Competition and Trade, Springer, vol. 9(2), pages 139-166, June.
    5. Alex Coad, 2009. "Investigating the exponential age distribution of firms," Papers on Economics and Evolution 2009-23, Philipps University Marburg, Department of Geography.
    6. Segarra, Agustí & Teruel, Mercedes, 2012. "An appraisal of firm size distribution: Does sample size matter?," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 314-328.
    7. Yannick Malevergne & Pedro Santa-Clara & Didier Sornette, 2009. "Professor Zipf goes to Wall Street," NBER Working Papers 15295, National Bureau of Economic Research, Inc.

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