The aim of this paper is to analyze the evolution of the size distribution of young firms within some selected industries, using as a background three theories of the distribution of firm sizes, which respectively identify a process of passive learning (Jovanovic 1982), one of active learning (Ericson and Pakes, 1995), and an evolutionary one (Audretsch, 1995) in the post-entry dynamics of business firms. We use a non-parametric technique, the kernel density estimator, applied to a data set from the Italian National Institute for Social Security (INPS), consisting in 12 cohorts of new manufacturing firms which were followed on a quarterly base for 6 years. We find that firm size distribution is in general skewed to the right, although different industries display different paths and speeds of convergence towards the limit distribution. This finding is fairly consistent with theories allowing for industry heterogeneity in terms of structural and technological features which, in turn, result in industry-specific evolution of the size distribution of new entrants
E. Santarelli, F. Lotti (2004). Industry Dynamics and the Distribution of Firm Sizes. SOUTHERN ECONOMIC JOURNAL, 70(3), 443-466 [10.2307/4135325].
Industry Dynamics and the Distribution of Firm Sizes
SANTARELLI, ENRICO;
2004
Abstract
The aim of this paper is to analyze the evolution of the size distribution of young firms within some selected industries, using as a background three theories of the distribution of firm sizes, which respectively identify a process of passive learning (Jovanovic 1982), one of active learning (Ericson and Pakes, 1995), and an evolutionary one (Audretsch, 1995) in the post-entry dynamics of business firms. We use a non-parametric technique, the kernel density estimator, applied to a data set from the Italian National Institute for Social Security (INPS), consisting in 12 cohorts of new manufacturing firms which were followed on a quarterly base for 6 years. We find that firm size distribution is in general skewed to the right, although different industries display different paths and speeds of convergence towards the limit distribution. This finding is fairly consistent with theories allowing for industry heterogeneity in terms of structural and technological features which, in turn, result in industry-specific evolution of the size distribution of new entrantsI documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
