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Power-Law and Log-Normal Distributions in Temporal Changes of Firm-Size Variables

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Author Info
Ishikawa, Atushi
Abstract

In this paper the author shows that signed temporal changes of firm size variables follow the power-law for large changes; while, for middle changes a log-normal distribution is found. In the analyses, the author employed three databases: highincome data, high-sales data and positive-profits data of Japanese firms. It is particularly worth noting that the growth rate distributions in temporal changes of the firm size data have no wide tail, unlike the distributions observed in assets and sales of firms, the number of employees and personal income data. An Extended-Gibrat's Law was also found in the growth rate distributions of temporal changes of firm size variables, which induces both the power-law and the log-normal distributions in the temporal changes of firm size under the Detailed Balance. --

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Publisher Info
Article provided by Kiel Institute for the World Economy in its journal Economics: The Open-Access, Open-Assessment E-Journal.

Volume (Year): 3 (2009)
Issue (Month): 11 ()
Pages: 1-25
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Handle: RePEc:zbw:ifweej:7597

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Related research
Keywords: Econophysics; temporal change of firm size; Pareto's law; log-normal distribution; (non-)Gibrat's law; detailed balance;

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  1. Yoshi Fujiwara & Corrado Di Guilmi & Hideaki Aoyama & Mauro Gallegati & Wataru Souma, 2003. "Do Pareto-Zipf and Gibrat laws hold true? An analysis with European Firms," Quantitative Finance Papers cond-mat/0310061, arXiv.org, revised Nov 2003. [Downloadable!]
  2. Xavier Gabaix, 2005. "The Granular Origins of Aggregate Fluctuations," 2005 Meeting Papers 470, Society for Economic Dynamics. [Downloadable!]
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  3. Atushi Ishikawa, 2007. "Quasistatically varying log-normal distribution in the middle scale region of Japanese land prices," Quantitative Finance Papers 0710.1893, arXiv.org. [Downloadable!]
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This page was last updated on 2009-12-8.


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