Granularity of the top 1,000 Brazilian companies
Sergio Da Silva (),
Ricardo Giglio and
Physica A: Statistical Mechanics and its Applications, 2018, vol. 512, issue C, 68-73
“Granularity” refers to the fact that economies are populated by a few large companies (the big “grains”) that coexist with many smaller companies. Such a distribution of firm sizes is modeled by power laws. This study adds to the international evidence of the granularity hypothesis by considering data for the top 1,000 Brazilian companies. We sort the companies from top to bottom in terms of their net revenues. Then, we adjust power laws to the data and estimate Pareto and Gumbel exponents. We find we cannot dismiss the hypothesis of granularity for the Brazilian companies. We also find the Pareto exponent is approximately one (1.070 ± .015), roughly a Zipf’s law. Such a result is in line with the previous one found for American companies where the Pareto exponent = 1.059. We also find a power-law progress curve best fits the data.
Keywords: Granularity; Companies; Firm-size distribution; Power law; Zipf’s law; Power-law progress curve (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:512:y:2018:i:c:p:68-73
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