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Do the Largest Firms Grow and Diversify the Fastest? The Case of U.S. Dairies

Almuhanad Melhim, Erik O'Donoghue and C. Shumway ()

No 2008-7, Working Papers from School of Economic Sciences, Washington State University

Abstract: We analyze growth and diversification of U.S. dairy farms by examining changes in ten size cohorts and new entrants through three successive censuses. We reject Gibrat’s law and the mean reversion hypothesis of growth. Growth rates appear bimodal where the smallest and largest farm cohorts grow fastest. All cohorts diversify but the largest farms do not diversify as rapidly as medium-sized farms. New entrants are generally large, and they diversify more rapidly than comparably-sized incumbents. These data suggest that scale economies persist even for the largest cohort of U.S. dairy farms and scale economies dominate scope economies for large farms.

Keywords: : census; dairy; diversification; growth; scale; scope (search for similar items in EconPapers)
JEL-codes: Q12 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2008-07
New Economics Papers: this item is included in nep-agr
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http://faculty.ses.wsu.edu/WorkingPapers/Shumway/Dairy_2nd_rev_080608.pdf First version, 2008 (application/pdf)

Related works:
Journal Article: Do the Largest Firms Grow and Diversify the Fastest? The Case of U.S. Dairies (2009)
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