Testing "Gibrat's Law" for Young Firms--Empirical Results for West Germany
The present paper deals with the question whether "Gibrat's law" is applicable to firms founded between 1989 and 1994 within the West German manufacturing sector or not. We find that firm size follows approximately a log normal distribution. Within the context of the econometric analyses conducted in the present study, firms are subdivided into young firms belonging to technology intensive and non-technology intensive branches as well as in different size classes. A method introduced in Chesher (1979) is used to explore "Gibrat's law" in order to examine the influence of firm size on growth. Using data from the ZEW-Foundation Panel (West), "Gibrat's law" is rejected for the group of young firms belonging to technology intensive branches as well as for those operating in non-technology intensive branches in all periods examined but no significant differences between both firm groups can be observed. This confirms the results of a number of empirical studies over the last few years, indicating that smaller firms have larger growth potential than larger ones. Copyright 2000 by Kluwer Academic Publishers
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 15 (2000)
Issue (Month): 1 (August)
|Contact details of provider:|| Web page: http://www.springer.com|
|Order Information:||Web: http://www.springer.com/new+%26+forthcoming+titles+%28default%29/journal/11187/PS2|
When requesting a correction, please mention this item's handle: RePEc:kap:sbusec:v:15:y:2000:i:1:p:1-12. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.