Skip Navigation



ICC Advance Access published online on August 17, 2006
Industrial and Corporate Change, doi:10.1093/icc/dtl019
This Article
Right arrow Full Text (PDF)
Right arrow All Versions of this Article:
15/5/847    most recent
dtl019v1
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Similar articles in this journal
Right arrow Alert me to new issues of the journal
Right arrow Add to My Personal Archive
Right arrow Download to citation manager
Right arrowRequest Permissions
Google Scholar
Right arrow Articles by Bottazzi, G.
Right arrow Articles by Secchi, A.
Right arrow Search for Related Content
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us  
What's this?

© The Author 2006. Published by Oxford University Press on behalf of Associazione ICC. All rights reserved

Article

Gibrat’s Law and diversification

Giulio Bottazzi 1 * and Angelo Secchi

1 Scuola Superiore Sant’Anna, P.za Martiri della Liberta’ 33, 56127, Pisa, Italy

* To whom correspondence should be addressed.
Giulio Bottazzi, E-mail: bottazzi{at}sssup.it


  Abstract

This article presents an analysis of the growth patterns of the worldwide top 200 firms in the pharmaceutical industry. A test of the Gibrat’s Law of Proportionate Effect is performed and we find, in line with previous literature, a violation concerning the variance of growth. Using disaggregated data on sub-markets, we are however able to show that this violation can be completely accounted for by a diversification effect, namely a scale relation between the number of sub-markets in which a firm is active and its size. To interpret these findings, we propose a stochastic branching model of firm diversification consistent with a notion of cumulative corporate competences.


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us    What's this?


This article has been cited by other articles:


Home page
 J ECON GEOGRHome page
K. Frenken and R. A. Boschma
A theoretical framework for evolutionary economic geography: industrial dynamics and urban growth as a branching process
J. Econ. Geogr., September 1, 2007; 7(5): 635 - 649.
[Abstract] [Full Text] [PDF]

Home page
 Ind Corp ChangeHome page
E. Santarelli and M. Vivarelli
Entrepreneurship and the process of firms' entry, survival and growth
Ind. Corp. Change, June 1, 2007; 16(3): 455 - 488.
[Abstract] [Full Text] [PDF]


Disclaimer: Please note that abstracts for content published before 1996 were created through digital scanning and may therefore not exactly replicate the text of the original print issues. All efforts have been made to ensure accuracy, but the Publisher will not be held responsible for any remaining inaccuracies. If you require any further clarification, please contact our Customer Services Department.