This paper studies the distribution of the firm size for the Colombian economy showing evidence against the Gibrat’s law, which assumes a stable lognormal distribution. On the contrary, we propose a lognormal expansion that captures deviations from the lognormal distribution with additional terms that allow a better fit at the upper distribution tail, which is overestimated according to the lognormal distribution. As a consequence, concentration indexes should be addressed consistently with the lognormal expansion. Through a dynamic panel data approach, we also show that firm growth is persistent and highly dependent on firm characteristics, including size, age, and leverage −these results neglect Gibrat’s law for the Colombian case.
CITATION STYLE
Cortés, L. M., Lozada, J. M., & Perote, J. (2021). Firm size and economic concentration: An analysis from a lognormal expansion. PLoS ONE, 16(7 July). https://doi.org/10.1371/journal.pone.0254487
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