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Some evidence about the evolution of the size distribution of Italian firms by age

Author

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  • Pasquale Cirillo

    (IMSV University of Bern)

Abstract

In this short note we are interested in the distribution of Italian firm size by age. In the wake of other recent work, such as Cabral and Mata (2003) [On the evolution of firm size distribution: facts and theory. American Economic Review 93, 1075-1090] for Portuguese companies, we aim to verify if the size distribution of young firms (less than 5 years old) is sensibly different from that of older firms (more than 30 years old). To perform our analysis we use a very comprehensive industrial panel, with about 25k firms for twenty years of observations. As far as the results are concerned, it is possible to verify a clear difference in the size distribution of firms by age, for which we give a good fit using the generalized beta distribution of the second kind.

Suggested Citation

  • Pasquale Cirillo, 2009. "Some evidence about the evolution of the size distribution of Italian firms by age," Economics Bulletin, AccessEcon, vol. 29(3), pages 1723-1730.
    • Handle: RePEc:ebl:ecbull:eb-09-00127
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    References listed on IDEAS

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    1. Paolo Angelini & Andrea Generale, 2008. "On the Evolution of Firm Size Distributions," American Economic Review, American Economic Association, vol. 98(1), pages 426-438, March.
    2. L. Crosato & P. Ganugi, 2007. "Statistical regularity of firm size distribution: the Pareto IV and truncated Yule for Italian SCI manufacturing," Statistical Methods & Applications, Springer;Società Italiana di Statistica, vol. 16(1), pages 85-115, June.
    3. Clementi, F. & Di Matteo, T. & Gallegati, M. & Kaniadakis, G., 2008. "The κ-generalized distribution: A new descriptive model for the size distribution of incomes," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 387(13), pages 3201-3208.
    4. Luís M B Cabral & José Mata, 2003. "On the Evolution of the Firm Size Distribution: Facts and Theory," American Economic Review, American Economic Association, vol. 93(4), pages 1075-1090, September.
    5. Singh, S K & Maddala, G S, 1976. "A Function for Size Distribution of Incomes," Econometrica, Econometric Society, vol. 44(5), pages 963-970, September.
    6. Giulio Bottazzi & Elena Cefis & Giovanni Dosi, 2002. "Corporate growth and industrial structures: some evidence from the Italian manufacturing industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 11(4), pages 705-723, August.
    7. James B. McDonald, 2008. "Some Generalized Functions for the Size Distribution of Income," Economic Studies in Inequality, Social Exclusion, and Well-Being, in: Duangkamon Chotikapanich (ed.), Modeling Income Distributions and Lorenz Curves, chapter 3, pages 37-55, Springer.
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    Cited by:

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    2. Montebruno, Piero & Bennett, Robert J. & van Lieshout, Carry & Smith, Harry, 2019. "A tale of two tails: Do Power Law and Lognormal models fit firm-size distributions in the mid-Victorian era?," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 523(C), pages 858-875.

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    More about this item

    Keywords

    firms' size distribution; generalized beta of the second kind; firms' age; empirical laws;
    All these keywords.

    JEL classification:

    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics
    • D3 - Microeconomics - - Distribution

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