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The Growth Opportunities For SMC?

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The extensive empirical literature on the validity of Gibrat's law does not in general verify the law as it finds that firms' growth rates are negatively correlated with both firm size and age. However, some studies find that Gibrat's law holds for sub-samples of firms such as large firms or firms belonging to special industries. It has been pointed out that these results are due to the fact that the likelihood of firm survival for natural reasons is positively related to firm size and age. This study uses a relatively large and representative sample of Danish firms to evaluate the validity of Gibrat's law for different kinds of firms over the period 1990 - 2003. In contrast to the majority of earlier studies our analysis corrects for the bias in the estimations by using variables related to the survival of small firms.
Original languageEnglish
Title of host publicationThe Next Decade Challenges For Business
EditorsVulfs Kozlinskis
Number of pages10
Publication year2006
Pages304-313
ISBN (print)9984-705-20-X
Publication statusPublished - 2006
EventThe Growth Opportunities For SMC? -
Duration: 2 Feb 20063 Feb 2006

Conference

ConferenceThe Growth Opportunities For SMC?
Periode02/02/200603/02/2006

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