On the size distribution of firms: additional evidence from the G7 countries

We analyze the average size distribution of a pool of the G7 group's firms over the period 1987-2000. In particular, firm sizes are measured employing different proxies, and after conditioning on business cycle phases. We find that: (i) the empirical distributions are all consistent with a power law; (ii) point estimates suggest that only in limited cases the exponent is equal to -1, i.e., the resulting size distribution generally is not Zipf; (iii) regardless of the variable employed to measure firm sizes, firms are distributed more equally during recessions than during expansions. (C) 2002 Elsevier Science B.V. All rights reserved.