The paper investigates whether liquidity constraints affect firm size and growth dynamics using a large longitudinal sample of Italian manufacturing firms. We run standard panel-data Gibrat regressions, suitably expanded to take into account liquidity constraints (proxied by cash flow)....

This paper studies how the interplay between technological shocks and financial variables shapes the properties of macroeconomic dynamics. Most of the existing literature has based the analysis of aggregate macroeconomic regularities on the representative agent hypothesis (RAH). However, recent...

Since the seminal work of Pareto, many empirical analyses suggested that the distribution of firms size is characterized by an asymptotic power like behavior. At the same time, recent investigations show that the distribution of annual growth rates of business firms displays a remarkable...

This paper is an empirical test of the hypothesis that the appropriateness of different business strategies is conditional on the firms distance to the industry frontier. We use data on four 2-digit high-tech manufacturing industries in the US over the period 1972-1999, and apply semi-parametric...

Empirical analyses on aggregated datasets have revealed a common exponential behavior in the shape of the probability density of the corporate growth rates. We present clearcut evidence on this topic using disaggregated data. We explain the observed regularities proposing a model in which the...

We relate innovation to sales growth for incumbent firms in four high-tech sectors. A firm, on average, experiences only modest growth and may grow for a number of reasons that may or may not be related to ‘innovativeness’. However, given that firms are heterogeneous and that growth rates...

We report several characteristics of industrial dynamics, including the firm size distribution, Gibrat's Law, and also the distribution of growth rates and their autocorrelation. We use a variety of econometric techniques, looking first at the aggregate and subsequently at a sectoral level. Many...

A puzzling evidence stemming from the applied research on growth and innovation is that successful innovations do not appear to have a significant effect on sales growth rates, at odds with the expectation that successful innovators will prosper at the expenses of their less able competitors....

If business firms face a multiplicative growth process in which their growth rates are independent from their sizes, then these sizes cannot be distributed according to a stationary Pareto distribution. At the same time , the Laplace distribution of growth rates cannot be easily reconciled with...

The size distribution and growth rates dynamics of U.S. manufacturing firms have been extensively studied by many authors. In this paper, using the COMPUSTAT database, we extend the analysis to disaggregated data, studying 15 industrial sectors. We find that among the stylized facts presented in...