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New evidence on Gibrat’s law for cities

Listed author(s):
  • Rafael González-Val

    ()

    (Universitat de Barcelona & IEB)

  • Luis Lanaspa

    ()

    (Universidad de Zaragoza)

  • Fernando Sanz

    ()

    (Universidad de Zaragoza)

The aim of this work is to test empirically the validity of Gibrat’s law on the growth of cities, using data on the complete distribution of cities from three countries (the US, Spain and Italy) for the entire twentieth century. In order to achieve this, we use different techniques. First, panel data unit root tests tend to confirm the validity of Gibrat’s law in the upper-tail distribution. Second, when we consider the entire distribution, we find that Gibrat’s law does not hold exactly in the long term using nonparametric methods that relate the growth rate to the initial city size.

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File URL: http://www.ieb.ub.edu/phocadownload/doc2012-18.pdf
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Paper provided by Institut d'Economia de Barcelona (IEB) in its series Working Papers with number 2012/18.

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Length: 44 pages
Date of creation: 2012
Handle: RePEc:ieb:wpaper:2012/6/doc2012-18
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