Gibrat's Law and peer group effect: the case of Tunisian small manufacturing companies
To extend the empirical research on Gibrat's law in developing countries, this article uses a linear-in-means model to test how inter-firm interactions can affect the growth of small manufacturing firms in Tunisia. More speciﬁcally, we distinguish between the effects of own ﬁrm's characteristics and mean characteristics of their neighbors on its growth. Using 1389 small manufacturing firms, we show that Gibrat's law is not confirmed. In addition, the results show that the average growth rate of neighboring firms located in the same governorate and belonging to the same sector affect signiﬁcantly individual ﬁrm's growth.
Volume (Year): 34 (2014)
Issue (Month): 1 ()
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