The firm size distribution and inter-industry diversification
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Date
2009-08
Authors
Hutchinson, John
Konings, Jozef
Paul Walsh, Patrick
Journal Title
Journal ISSN
Volume Title
Publisher
UCD GEARY INSTITUTE
Abstract
We show that the stylized facts of the Firm Size Distribution (FSD) by age cohorts, as shown
in Cabral and Mata (2003), bind within 4-digit manufacturing industries in the UK and
Belgium. As in Klepper and Thompson (2006) and Sutton (1998), we explore whether time to
build a portfolio of products is a mechanism that relates age to firm size. While inter industry
diversification, to some extent, accounts for the role of age, we find that the presence of
economies of scope has a separate impact on firm size when controlling for age, amongst
other factors. Using the techniques in Cabral and Mata’s we show that the FSD by degrees of
product diversification shifts to the right, but more so in older age groups. This shows a role
for inter-industry diversification over and above an age effect.
Description
Keywords
distribution, inter-industry diversification, Research Subject Categories::SOCIAL SCIENCES::Business and economics
Citation
Hutchinson John, Konings Jozef, Paul Walsh Patrick, 2009, UCD GEARY INSTITUTE; The firm size distribution and inter-industry diversification. http://nur.nu.edu.kz/handle/123456789/1904