While Gibrat’s Law assumes that growth rate variance is independent of size, empirical work has usually found a negative relationship between growth rate variance and ?rm growth. Using data on French manufacturing ?rms, we observe a relatively low, but statistically signi?cant, negative relationship between ?rm size and growth rate variance. Furthermore, we observe that growth rate variance does not decrease monotonically the more plants a ?rm possesses, which is at odds with a number of theoretical models.
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