Gibrat's Law for (All) Cities: Comment

Moshe Levy ()

American Economic Review, 2009, vol. 99, issue 4, 1672-75

Abstract: Jan Eeckhout (2004) reports that the empirical city size distribution is lognormal, consistent with Gibrat's Law. We show that for the top 0.6 percent of the largest cities, the empirical distribution is dramatically different from the lognormal, and follows a power law. This top part is extremely important as it accounts for more than 23 percent of the population. The empirical hybrid lognormal-power-law distribution revealed may be characteristic of other key distributions, such as the wealth distribution and the income distribution. This distribution is not consistent with a simple Gibrat proportionate effect process, and its origin presents a puzzle yet to be answered. (JEL R11, R12, R23)

JEL-codes: R11 R12 R23 (search for similar items in EconPapers)
Date: 2009
Note: DOI: 10.1257/aer.99.4.1672
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Citations: View citations in EconPapers (67)

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