Abstract

Firm size increases with GDP per capita. The paper develops a simple framework to explore three alternative sources of variation that may explain this correlation: (1) excessive entry; (2) differences in the distribution of firm productivities; and (3) differences in returns to scale. The results show that all these sources of variation lead to substantial differences in firm size. GDP per capita is also significantly affected, but by an order of magnitude less.

pdf

Additional Information

ISSN
1533-6239
Print ISSN
1529-7470
Pages
pp. 27-49
Launched on MUSE
2016-10-28
Open Access
No
Back To Top

This website uses cookies to ensure you get the best experience on our website. Without cookies your experience may not be seamless.