Testing the validity of Gibrat's law in the context of profitability performance
The result's identifiers
Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F71226401%3A_____%2F19%3AN0100274" target="_blank" >RIV/71226401:_____/19:N0100274 - isvavai.cz</a>
Result on the web
<a href="https://www.tandfonline.com/doi/pdf/10.1080/1331677X.2019.1655656?needAccess=true&" target="_blank" >https://www.tandfonline.com/doi/pdf/10.1080/1331677X.2019.1655656?needAccess=true&</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.1080/1331677X.2019.1655656" target="_blank" >10.1080/1331677X.2019.1655656</a>
Alternative languages
Result language
angličtina
Original language name
Testing the validity of Gibrat's law in the context of profitability performance
Original language description
The purpose of the article is to investigate whether the profitability of firms affects the validity of Gibrat's law. We begin with the thesis that small firms have less access to outside financial sources (especially bank loans) than large companies, so the role of profit in generating growth varies depending on firm size and is probably more important for smaller companies. We divided a large sample of companies (about 30,000 firms) into three profitability groups (lower 25%, middle 50%, and upper 25% of firms) to examine whether the size-growth relationship is influenced by profitability. Gibrat's law was verified both at the aggregate level and at the industry level (using one-digit NACE classification). The results show that the validity of Gibrat's law is not significantly influenced by the amount of firm profit at the aggregate level or at the industry level. In most sectors and profitability groups, smaller firms grow faster than their larger counterparts do.
Czech name
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Czech description
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Classification
Type
J<sub>imp</sub> - Article in a specialist periodical, which is included in the Web of Science database
CEP classification
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OECD FORD branch
50204 - Business and management
Result continuities
Project
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Continuities
I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace
Others
Publication year
2019
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů
Data specific for result type
Name of the periodical
Economic Research-Ekonomska Istrazivanja
ISSN
1331-677X
e-ISSN
1848-9664
Volume of the periodical
32
Issue of the periodical within the volume
1
Country of publishing house
CZ - CZECH REPUBLIC
Number of pages
14
Pages from-to
2850-2863
UT code for WoS article
000483821100001
EID of the result in the Scopus database
2-s2.0-85071669049