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Common Properties and Sectoral Specificities in the Dynamics of U.S. Manufacturing Companies

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  • Giulio Bottazzi
  • Angelo Secchi

Abstract

The size distribution and growth rate dynamics of U.S. companieshave been extensively studied by many authors. In this paper,using the COMPUSTAT database, we extend the analysis todisaggregated data, studying 15 sectors of the U.S.manufacturing industry. The sectoral investigation reveals thepresence of general statistical properties that can be consideredvalid across all the studied sectors. In particular, theprobability density of firms growth rates invariably displays acharacteristic tent shape and the relation between the size of afirm and the variance of its rates of growth is characterized, indifferent sectors, by very similar scaling relations. Thepresence of characteristics that are robust and sectoral invarianthints at the existence of generic statistical properties shapingthe dynamic of firms across the whole industry. Copyright Kluwer Academic Publishers 2003

Suggested Citation

  • Giulio Bottazzi & Angelo Secchi, 2003. "Common Properties and Sectoral Specificities in the Dynamics of U.S. Manufacturing Companies," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 23(3), pages 217-232, December.
  • Handle: RePEc:kap:revind:v:23:y:2003:i:3:p:217-232
    DOI: 10.1023/B:REIO.0000031366.28559.c1
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    8. Giulio Bottazzi, 2001. "Firm Diversification and the Law of Proportionate Effect," LEM Papers Series 2001/01, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    9. Nunes Amaral, Luís A & Buldyrev, Sergey V & Havlin, Shlomo & Maass, Philipp & Salinger, Michael A & Eugene Stanley, H & Stanley, Michael H.R, 1997. "Scaling behavior in economics: The problem of quantifying company growth," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 244(1), pages 1-24.
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