Firm size and productivity from occupational choices
Luis Medrano-Adán (),
Vicente Salas-Fumás () and
J. Javier Sanchez-Asin ()
Additional contact information
Luis Medrano-Adán: CUD (Zaragoza)
Vicente Salas-Fumás: University of Zaragoza
J. Javier Sanchez-Asin: University of Zaragoza
Small Business Economics, 2019, vol. 53, issue 1, No 12, 243-267
Abstract We model the distributions of firm sizes and of firms’ total factor productivity (TFP) as outcomes of a market equilibrium from the occupational decisions of individuals with different entrepreneurial skills, of working as employees, employers, or solo entrepreneurs. The model explains empirical regularities such as (i) the positive cross-section correlation between average size of firms and average labor productivity of countries, (ii) the positive association between size and TFP of firms in an economy, and (iii) the power law distribution of firm sizes. Two parameters of the model, one that measures the organizational size diseconomies and other related to the dispersion of the distribution of entrepreneurial skills in the population, appear as main determinants of the differences in firm sizes and in productivity, across economies and among firms within an economy. The results of the paper should be of interest for the design and evaluation of firm-size-dependent policies.
Keywords: Occupational choices; Distribution of firm sizes; Productivity; Power law distribution; Firm-size-dependent policies; J24; L25; L26; D24 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
http://link.springer.com/10.1007/s11187-018-0048-y Abstract (text/html)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:kap:sbusec:v:53:y:2019:i:1:d:10.1007_s11187-018-0048-y
Ordering information: This journal article can be ordered from
http://www.springer. ... 29/journal/11187/PS2
Access Statistics for this article
Small Business Economics is currently edited by Zoltan J. Acs and David B. Audretsch
More articles in Small Business Economics from Springer
Bibliographic data for series maintained by Sonal Shukla ().