Empirical analysis of firm-dynamics on Japanese interfirm trade network

Abstract

We analyze Japanese interfirm trade network data for 20 years from the viewpoint of the metabolism of scale-free network evolution. We find that the preferential attachment effect of established firms is stronger than that of merged firms. This shows that merging firms should choose counterparties using delicate business strategies that may not be related to the degree. We also find that the distribution of lifespan of links is approximated well by an exponential function with the characteristic time of 6 years. The results imply the link creation and deletion is well characterized by a Poisson process.