GIBRAT’S LAW AND LIQUIDITY CONSTRAINTS: EVIDENCE FROM MALAYSIA INDUSTRIAL SECTOR COMPANIES
DOI:
https://doi.org/10.31436/ijema.v24i2.357Abstract
Gibrat’s Law, or the Law of Proportionate Effect (LPE), presupposes that the growth rate of a given company is independent of its initial size. While older studies have a tendency to confirm the LPE, recent studies generally reject it. Only very few empirical studies have examined the validity of Gibrat’s Law in developing countries, with most studies focused on developed countries. In this study, we investigated the validity of the LPE in Malaysia. We also investigated whether liquidity constraints have any influence on firm growth and firm growth-size dynamics. By employing the Generalized Method of Moments (GMM) system to estimate a panel data model of the firm growth of 210 firms that were part of the Malaysian industrial sector from 2005 to 2014, we found that Gibrat’s Law was invalid and liquidity constraints had no role in explaining both the firms’ growth and growth-size dynamics, whereas age was found to positively affect the firms’ growth.
References
Acs, Z.J., and D.B. Audretsch. Innovation and Small Firms. MIT Press, 1990.
Antoniou, A., Y. Guney, and K. Paudyal. “The Determinants of Capital Structure: Capital Market-Oriented versus Bank-Oriented Institutions.†Journal of Financial and Quantitative Analysis 43, no. 1 (2008): 59-92.
Arellano, M., and O. Bover. “Another Look at the Instrumental Variable Estimation of Error-Components Models.†Journal of Econometrics 68, no. 1 (1995): 29-51.
_______, and S. Bond. “Some Tests of Specification for Panel Data: Monte Carlo Evidence and An Application to Employment Equations.†The Review of Economic Studies 58, no. 2 (1991): 277-97.
Aslan, A. Testing Gibrat’s Law: Empirical Evidence from Panel Unit Root Tests of Turkish Firms. Working Paper No. 10594. University Library of Munich, Germany, 2008.
Audretsch, D.B. “Innovation, Growth and Survival.†International Journal of Industrial Organization 13, no. 4 (1995): 441-57.
_______, and J.A. Elston. “Does Firm Size Matter? Evidence on the Impact of Liquidity Constraints on Firm Investment Behavior in Germany.†International Journal of Industrial Organization 20, no. 1 (2002): 1-17.
Becchetti, L., and G. Trovato. “The Determinants of Growth for Small and Medium Sized Firms. The Role of the Availability of External Finance.†Small Business Economics 19, no. 4 (2002): 291-306.
Binks, M.R., and C.T. Ennew. “Growing Firms and the Credit Constraint.†Small Business Economics 8, no. 1 (1996): 17-25.
Blundell, R., and S. Bond. “Initial Conditions and Moment Restrictions in Dynamic Panel Data Models.†Journal of Econometrics 87, no. 1 (1998): 115-43.
Bond, S., J.A. Elston, J. Mairesse, and B. Mulkay. “Financial Factors and Investment in Belgium, France, Germany, and the United Kingdom: A Comparison Using Company Panel Data.†Review of Economics and Statistics 85, no. 1 (2003): 153-65.
Bottazzi, G., A. Coad, N. Jacoby, and A. Secchi. “Corporate Growth and Industrial Dynamics: Evidence from French Manufacturing.†Applied Economics 43, no. 1 (2011): 103-16.
Brock, J. W. “Bigness is the Problem, not the Solution.†Challenge 30, no. 3 (1987): 11-6.
Cabral, L., and J. Mata. “On the Evolution of the Firm Size Distribution: Facts and Theory.†The American Economic Review 93, no. 4 (2003): 1075-90.
Calvo, J.L. “Testing Gibrat’s Law for Small, Young and Innovating Firms.†Small Business Economics 26, no. 2 (2006): 117-23.
Carpenter, R.E., and B.C. Petersen. “Is the Growth of Small Firms Constrained by Internal Finance?†Review of Economics and Statistics 84, no. 2 (2002): 298-309.
Chesher, A. “Testing the Law of Proportionate Effect.†Journal of Industrial Economics 27, no. 4 (1979): 403-11.
Thomas, C., and Q. Vicenzo. “Financial Markets and Firm Dynamics.†American Economic Review 91 (1998): 1286-310.
Das, S. “Size, Age and Firm Growth in an Infant Industry: The Computer Hardware Industry in India.†International Journal of Industrial Organization 13, no. 1 (1995): 111-26.
Davies, S.W., and B.R. Lyons. “Seller Concentration: The Technological Explanation and Demand Uncertainty.†The Economic Journal 92, no. 368 (1982): 903-19.
Department of Statistics, Malaysia. Annual Gross Domestic Product 2010-2015, Malaysia, ISSN, 1985-0751. Retrieved from:
https://newss.statistics.gov.my/news-portalx/ep/epFreeDownloadContentSearch.seam?cid=41995
Devereux, M., and F. Schiantarelli. “Investment, Financial Factors, and Cash Flow: Evidence from UK Panel Data.†In Asymmetric Information, Corporate Finance, and Investment, edited by R. Glenn Hubbard, 279-306. University of Chicago Press, 1990.
Dhawan, R. “Firm Size and Productivity Differential: Theory and Evidence from a Panel of US Firms.†Journal of Economic Behavior & Organization 44, no. 3 (2001): 269-93.
Dunne, P., and A. Hughes. “Age, Size, Growth and Survival: UK Companies in the 1980s.†Journal of Industrial Economics 42, no. 2 (1994): 115-40.
Dunne, T., M.J. Roberts, and L. Samuelson. “The Growth and Failure of US Manufacturing Plants.†The Quarterly Journal of Economics 104, no. 4 (1989): 671-98.
Edmunds, S.W. “Organizational Size and Efficiency in the US.†Antitrust Bulletin 26, no. 3 (1981): 507.
Elston, J.A. “An Examination of the Relationship Between Firm Size, Growth and Liquidity in the Neuer Markt.†Discussion Paper 15/02, Economic Research Centre, Deutsche Bundesbank, June 2002.
Evans, D.S. “Tests of Alternative Theories of Firm Growth.†Journal of Political Economy 95, no. 4 (1987): 657-74.
_______. “The Relationship between Firm Growth, Size, and Age: Estimates for 100 Manufacturing Industries.†Journal of Industrial Economics 35, no. 4 (1987): 567-81.
_______, and B. Jovanovic. “An Estimated Model of Entrepreneurial Choice under Liquidity Constraints.†Journal of Political Economy 97, no. 4 (1989): 808-27.
Fagiolo, G., and A. Luzzi. “Do Liquidity Constraints Matter in Explaining Firm Size and Growth? Some Evidence from the Italian Manufacturing Industry.†Industrial and Corporate Change 15, no. 1 (2006): 1-39.
Fazzari, S.M., and M.J. Athey. “Asymmetric Information, Financing Constraints, and Investment.†The Review of Economics and Statistics 69, no. 3 (1987): 481-87.
_______, R. Glenn Hubbard, and B. Petersen. “Investment, Financing Decisions, and Tax Policy.†The American Economic Review 78, no. 2 (1988): 200-5.
Fujiwara, Y., C. Di Guilmi, H. Aoyama, M. Gallegati, and W. Souma. “Do Pareto–Zipf and Gibrat Laws Hold True? An Analysis with European Firms.†Physica A: Statistical Mechanics and its Applications 335, no. 1 (2004): 197-216.
Geroski, P.A. “What Do We Know about Entry?†International Journal of Industrial Organization 13, no. 4 (1995): 421-40.
Gibrat, R. Les Inégalités Economiques: Applications: Aux Inégalitês des Richesses, à la Concentration des Entreprises, aux Populations des Villes, aux Statistiques des Familles, etc: D'une Loi Nouvelle: La Loi de L'effet Proportionnel. Librairie du Recueil Sirey, 1931.
Gilchrist, S., and C.P. Himmelberg. “Evidence on the Role of Cash Flow for Investment.†Journal of Monetary Economics 36, no. 3 (1995): 541-72.
Gill, A., and N. Mathur. “Factors that Affect Potential Growth of Canadian Firms.†Journal of Applied Finance and Banking 1, no. 4 (2011): 107-23.
Glancey, K. “Determinants of Growth and Profitability in Small Entrepreneurial Firms.†International Journal of Entrepreneurial Behavior & Research 4, no. 1 (1998): 18-27.
Goddard, J.A., D.G. McKillop, and J.O. Wilson. “The Growth of US Credit Unions.†Journal of Banking & Finance 26, no. 12 (2002): 2327-56.
_______, J. Wilson, and P. Blandon. “Panel Tests of Gibrat’s Law for Japanese Manufacturing.†International Journal of Industrial Organization 20, no. 3 (2002): 415-33.
Hackston, D., and M.J. Milne. “Some Determinants of Social and Environmental Disclosures in New Zealand Companies.†Accounting, Auditing & Accountability Journal 9, no. 1 (1996): 77-108.
Hall, B.H. “Unpublished Appendices from the Relationship between Firm Size and Firm Growth in the US Manufacturing Sector.†Journal of Industrial Economics 35 (1987): 583-606.
Haniffa, R.M., and T.E. Cooke. “The Impact of Culture and Governance on Corporate Social Reporting.†Journal of Accounting and Public Policy 24, no. 5 (2005): 391-430.
Hart, P.E., and N. Oulton. “Growth and Size of Firms.†Economic Journal 106, no. 438 (1996): 1242-52.
Heshmati, A. “On the Growth of Micro and Small Firms: Evidence from Sweden.†Small Business Economics 17, no. 3 (2001): 213-28.
Ho, S.S., and K.S. Wong. “A Study of the Relationship between Corporate Governance Structures and the Extent of Voluntary Disclosure.†Journal of International Accounting, Auditing and Taxation 10, no. 2 (2001): 139-56.
Hölzl, W. “Persistence, Survival, and Growth: a Closer Look at 20 years of Fast-Growing Firms in Austria.†Industrial and Corporate Change 23, no. 1 (2014): 199-231.
Hoshi, T., A. Kashyap, and D. Scharfstein. “Corporate Structure, Liquidity, and Investment: Evidence from Japanese Industrial Groups.†The Quarterly Journal of Economics 106, no. 1 (1991): 33-60.
Huyghebaert, N., and L.M. Van de Gucht. “The Determinants of Financial Structure: New Insights from Business Startâ€Ups.†European Financial Management 13, no. 1 (2007): 101-33.
Jovanovic, Boyan. “Selection and the Evolution of Industry.†Econometrica 50, no. 3 (1982): 649-70.
Kumar, M.S. “Growth, Acquisition Activity and Firm Size: Evidence from the United Kingdom.†Journal of Industrial Economics 33, no. 3 (1985): 327-38.
Serrasqueiro, Z., and P.M. Nunes. “Non-linear Relationships between Growth Opportunities and Debt: Evidence from Quoted Portuguese Companies.†Journal of Business Research 63, no. 8 (2010): 870-78.
Limère, A., E. Laveren, and K. Van Hoof. A Classification Model for Firm Growth on the Basis of Ambitions, External Potential and Resources by means of Decision Tree Induction. Working Papers, University of Antwerp, Faculty of Applied Economics, 2004.
http://EconPapers.repec.org/RePEc:ant:wpaper:2004027.
Lotti, F., E. Santarelli, and M. Vivarelli. “Does Gibrat's Law Hold among Young, Small Firms?†Journal of Evolutionary Economics 13, no. 3 (2003): 213-35.
Mahmoud Abu-Tapanjeh, A. “An Empirical Study of Firm Structure and Profitability Relationship: The Case of Jordan.†Journal of Economic and Administrative Sciences 22, no. 1 (2006): 41-59.
Mansfield, E. “Entry, Gibrat’s Law, Innovation, and the Growth of Firms.†The American Economic Review 52, no. 5 (1962): 1023-51.
Mata, J. “Firm Growth During Infancy.†Small Business Economics 6, no. 1 (1994): 27-39.
Myers, S.C., and N.S. Majluf. “Corporate Financing and Investment Decisions when Firms Have Information that Investors Do Not Have.†Journal of Financial Economics 13, no. 2 (1984): 187-221.
Nassar, I.A., M.K. Almsafir, and M.H. Al-Mahrouq. “The Validity of Gibrat’s Law in Developed and Developing Countries (2008–2013): Comparison based Assessment.†Procedia-Social and Behavioral Sciences 129 (2014): 266-73.
Oliveira, B., and A. Fortunato. “Firm Growth and Liquidity Constraints: A Dynamic Analysis.†Small Business Economics 27, no. 2-3 (2006): 139-56.
Penrose, E. The Theory of the Firm. NY: John Wiley & Sons, 1959.
Pettigrew, A., E. Ferlie, and L. McKee. “Shaping Strategic Changeâ€The Case of the NHS in the 1980s.†Public Money & Management 12, no. 3 (1992): 27-31.
Piergiovanni, R., E. Santarelli, L. Klomp, and A.R. Thurik. “Gibrat’s Law and the Firm Size/Firm Growth Relationship in Italian Services.†Tinbergen Institute Discussion Paper Series No. TI 02-080/3, 2002.
Prais, S.J. The Evolution of Giant Firms in Britain: A Study of the Growth of Concentration in Manufacturing Industry in Britain, 1909-70; Second Impression with a New Preface on Developments in 1970-76. Cambridge University Press, 1976.
Serrasqueiro, Z., P.M. Nunes, J. Leitão, and M. Armada. “Are there Non-Linearities between SME Growth and its Determinants? A Quantile Approach.†Industrial and Corporate Change 19, no. 4 (2010): 1071-108.
Sutton, J. “Gibrat’s Legacy.†Journal of Economic Literature 35, no. 1 (1997): 40-59.
Templeton, G.F. “A Two-Step Approach for Transforming Continuous Variables to Normal: Implications and Recommendations for IS Research.†Communications of the Association for Information Systems 28, no. 4 (2011): 41-58.
Tschoegl, A. E. “Size, Growth, and Transnationality among the World’s Largest Banks.†The Journal of Business 56, no. 2 (1983): 187-201.
Vlachvei, A., and O. Notta. “Firm Growth, Size and Age in Greek Firms.†Proceedings of International Conference on Applied Economics (2008): 915-21.
Antoniou, A., Y. Guney, and K. Paudyal. “The Determinants of Capital Structure: Capital Market-Oriented versus Bank-Oriented Institutions.†Journal of Financial and Quantitative Analysis 43, no. 1 (2008): 59-92.
Arellano, M., and O. Bover. “Another Look at the Instrumental Variable Estimation of Error-Components Models.†Journal of Econometrics 68, no. 1 (1995): 29-51.
_______, and S. Bond. “Some Tests of Specification for Panel Data: Monte Carlo Evidence and An Application to Employment Equations.†The Review of Economic Studies 58, no. 2 (1991): 277-97.
Aslan, A. Testing Gibrat’s Law: Empirical Evidence from Panel Unit Root Tests of Turkish Firms. Working Paper No. 10594. University Library of Munich, Germany, 2008.
Audretsch, D.B. “Innovation, Growth and Survival.†International Journal of Industrial Organization 13, no. 4 (1995): 441-57.
_______, and J.A. Elston. “Does Firm Size Matter? Evidence on the Impact of Liquidity Constraints on Firm Investment Behavior in Germany.†International Journal of Industrial Organization 20, no. 1 (2002): 1-17.
Becchetti, L., and G. Trovato. “The Determinants of Growth for Small and Medium Sized Firms. The Role of the Availability of External Finance.†Small Business Economics 19, no. 4 (2002): 291-306.
Binks, M.R., and C.T. Ennew. “Growing Firms and the Credit Constraint.†Small Business Economics 8, no. 1 (1996): 17-25.
Blundell, R., and S. Bond. “Initial Conditions and Moment Restrictions in Dynamic Panel Data Models.†Journal of Econometrics 87, no. 1 (1998): 115-43.
Bond, S., J.A. Elston, J. Mairesse, and B. Mulkay. “Financial Factors and Investment in Belgium, France, Germany, and the United Kingdom: A Comparison Using Company Panel Data.†Review of Economics and Statistics 85, no. 1 (2003): 153-65.
Bottazzi, G., A. Coad, N. Jacoby, and A. Secchi. “Corporate Growth and Industrial Dynamics: Evidence from French Manufacturing.†Applied Economics 43, no. 1 (2011): 103-16.
Brock, J. W. “Bigness is the Problem, not the Solution.†Challenge 30, no. 3 (1987): 11-6.
Cabral, L., and J. Mata. “On the Evolution of the Firm Size Distribution: Facts and Theory.†The American Economic Review 93, no. 4 (2003): 1075-90.
Calvo, J.L. “Testing Gibrat’s Law for Small, Young and Innovating Firms.†Small Business Economics 26, no. 2 (2006): 117-23.
Carpenter, R.E., and B.C. Petersen. “Is the Growth of Small Firms Constrained by Internal Finance?†Review of Economics and Statistics 84, no. 2 (2002): 298-309.
Chesher, A. “Testing the Law of Proportionate Effect.†Journal of Industrial Economics 27, no. 4 (1979): 403-11.
Thomas, C., and Q. Vicenzo. “Financial Markets and Firm Dynamics.†American Economic Review 91 (1998): 1286-310.
Das, S. “Size, Age and Firm Growth in an Infant Industry: The Computer Hardware Industry in India.†International Journal of Industrial Organization 13, no. 1 (1995): 111-26.
Davies, S.W., and B.R. Lyons. “Seller Concentration: The Technological Explanation and Demand Uncertainty.†The Economic Journal 92, no. 368 (1982): 903-19.
Department of Statistics, Malaysia. Annual Gross Domestic Product 2010-2015, Malaysia, ISSN, 1985-0751. Retrieved from:
https://newss.statistics.gov.my/news-portalx/ep/epFreeDownloadContentSearch.seam?cid=41995
Devereux, M., and F. Schiantarelli. “Investment, Financial Factors, and Cash Flow: Evidence from UK Panel Data.†In Asymmetric Information, Corporate Finance, and Investment, edited by R. Glenn Hubbard, 279-306. University of Chicago Press, 1990.
Dhawan, R. “Firm Size and Productivity Differential: Theory and Evidence from a Panel of US Firms.†Journal of Economic Behavior & Organization 44, no. 3 (2001): 269-93.
Dunne, P., and A. Hughes. “Age, Size, Growth and Survival: UK Companies in the 1980s.†Journal of Industrial Economics 42, no. 2 (1994): 115-40.
Dunne, T., M.J. Roberts, and L. Samuelson. “The Growth and Failure of US Manufacturing Plants.†The Quarterly Journal of Economics 104, no. 4 (1989): 671-98.
Edmunds, S.W. “Organizational Size and Efficiency in the US.†Antitrust Bulletin 26, no. 3 (1981): 507.
Elston, J.A. “An Examination of the Relationship Between Firm Size, Growth and Liquidity in the Neuer Markt.†Discussion Paper 15/02, Economic Research Centre, Deutsche Bundesbank, June 2002.
Evans, D.S. “Tests of Alternative Theories of Firm Growth.†Journal of Political Economy 95, no. 4 (1987): 657-74.
_______. “The Relationship between Firm Growth, Size, and Age: Estimates for 100 Manufacturing Industries.†Journal of Industrial Economics 35, no. 4 (1987): 567-81.
_______, and B. Jovanovic. “An Estimated Model of Entrepreneurial Choice under Liquidity Constraints.†Journal of Political Economy 97, no. 4 (1989): 808-27.
Fagiolo, G., and A. Luzzi. “Do Liquidity Constraints Matter in Explaining Firm Size and Growth? Some Evidence from the Italian Manufacturing Industry.†Industrial and Corporate Change 15, no. 1 (2006): 1-39.
Fazzari, S.M., and M.J. Athey. “Asymmetric Information, Financing Constraints, and Investment.†The Review of Economics and Statistics 69, no. 3 (1987): 481-87.
_______, R. Glenn Hubbard, and B. Petersen. “Investment, Financing Decisions, and Tax Policy.†The American Economic Review 78, no. 2 (1988): 200-5.
Fujiwara, Y., C. Di Guilmi, H. Aoyama, M. Gallegati, and W. Souma. “Do Pareto–Zipf and Gibrat Laws Hold True? An Analysis with European Firms.†Physica A: Statistical Mechanics and its Applications 335, no. 1 (2004): 197-216.
Geroski, P.A. “What Do We Know about Entry?†International Journal of Industrial Organization 13, no. 4 (1995): 421-40.
Gibrat, R. Les Inégalités Economiques: Applications: Aux Inégalitês des Richesses, à la Concentration des Entreprises, aux Populations des Villes, aux Statistiques des Familles, etc: D'une Loi Nouvelle: La Loi de L'effet Proportionnel. Librairie du Recueil Sirey, 1931.
Gilchrist, S., and C.P. Himmelberg. “Evidence on the Role of Cash Flow for Investment.†Journal of Monetary Economics 36, no. 3 (1995): 541-72.
Gill, A., and N. Mathur. “Factors that Affect Potential Growth of Canadian Firms.†Journal of Applied Finance and Banking 1, no. 4 (2011): 107-23.
Glancey, K. “Determinants of Growth and Profitability in Small Entrepreneurial Firms.†International Journal of Entrepreneurial Behavior & Research 4, no. 1 (1998): 18-27.
Goddard, J.A., D.G. McKillop, and J.O. Wilson. “The Growth of US Credit Unions.†Journal of Banking & Finance 26, no. 12 (2002): 2327-56.
_______, J. Wilson, and P. Blandon. “Panel Tests of Gibrat’s Law for Japanese Manufacturing.†International Journal of Industrial Organization 20, no. 3 (2002): 415-33.
Hackston, D., and M.J. Milne. “Some Determinants of Social and Environmental Disclosures in New Zealand Companies.†Accounting, Auditing & Accountability Journal 9, no. 1 (1996): 77-108.
Hall, B.H. “Unpublished Appendices from the Relationship between Firm Size and Firm Growth in the US Manufacturing Sector.†Journal of Industrial Economics 35 (1987): 583-606.
Haniffa, R.M., and T.E. Cooke. “The Impact of Culture and Governance on Corporate Social Reporting.†Journal of Accounting and Public Policy 24, no. 5 (2005): 391-430.
Hart, P.E., and N. Oulton. “Growth and Size of Firms.†Economic Journal 106, no. 438 (1996): 1242-52.
Heshmati, A. “On the Growth of Micro and Small Firms: Evidence from Sweden.†Small Business Economics 17, no. 3 (2001): 213-28.
Ho, S.S., and K.S. Wong. “A Study of the Relationship between Corporate Governance Structures and the Extent of Voluntary Disclosure.†Journal of International Accounting, Auditing and Taxation 10, no. 2 (2001): 139-56.
Hölzl, W. “Persistence, Survival, and Growth: a Closer Look at 20 years of Fast-Growing Firms in Austria.†Industrial and Corporate Change 23, no. 1 (2014): 199-231.
Hoshi, T., A. Kashyap, and D. Scharfstein. “Corporate Structure, Liquidity, and Investment: Evidence from Japanese Industrial Groups.†The Quarterly Journal of Economics 106, no. 1 (1991): 33-60.
Huyghebaert, N., and L.M. Van de Gucht. “The Determinants of Financial Structure: New Insights from Business Startâ€Ups.†European Financial Management 13, no. 1 (2007): 101-33.
Jovanovic, Boyan. “Selection and the Evolution of Industry.†Econometrica 50, no. 3 (1982): 649-70.
Kumar, M.S. “Growth, Acquisition Activity and Firm Size: Evidence from the United Kingdom.†Journal of Industrial Economics 33, no. 3 (1985): 327-38.
Serrasqueiro, Z., and P.M. Nunes. “Non-linear Relationships between Growth Opportunities and Debt: Evidence from Quoted Portuguese Companies.†Journal of Business Research 63, no. 8 (2010): 870-78.
Limère, A., E. Laveren, and K. Van Hoof. A Classification Model for Firm Growth on the Basis of Ambitions, External Potential and Resources by means of Decision Tree Induction. Working Papers, University of Antwerp, Faculty of Applied Economics, 2004.
http://EconPapers.repec.org/RePEc:ant:wpaper:2004027.
Lotti, F., E. Santarelli, and M. Vivarelli. “Does Gibrat's Law Hold among Young, Small Firms?†Journal of Evolutionary Economics 13, no. 3 (2003): 213-35.
Mahmoud Abu-Tapanjeh, A. “An Empirical Study of Firm Structure and Profitability Relationship: The Case of Jordan.†Journal of Economic and Administrative Sciences 22, no. 1 (2006): 41-59.
Mansfield, E. “Entry, Gibrat’s Law, Innovation, and the Growth of Firms.†The American Economic Review 52, no. 5 (1962): 1023-51.
Mata, J. “Firm Growth During Infancy.†Small Business Economics 6, no. 1 (1994): 27-39.
Myers, S.C., and N.S. Majluf. “Corporate Financing and Investment Decisions when Firms Have Information that Investors Do Not Have.†Journal of Financial Economics 13, no. 2 (1984): 187-221.
Nassar, I.A., M.K. Almsafir, and M.H. Al-Mahrouq. “The Validity of Gibrat’s Law in Developed and Developing Countries (2008–2013): Comparison based Assessment.†Procedia-Social and Behavioral Sciences 129 (2014): 266-73.
Oliveira, B., and A. Fortunato. “Firm Growth and Liquidity Constraints: A Dynamic Analysis.†Small Business Economics 27, no. 2-3 (2006): 139-56.
Penrose, E. The Theory of the Firm. NY: John Wiley & Sons, 1959.
Pettigrew, A., E. Ferlie, and L. McKee. “Shaping Strategic Changeâ€The Case of the NHS in the 1980s.†Public Money & Management 12, no. 3 (1992): 27-31.
Piergiovanni, R., E. Santarelli, L. Klomp, and A.R. Thurik. “Gibrat’s Law and the Firm Size/Firm Growth Relationship in Italian Services.†Tinbergen Institute Discussion Paper Series No. TI 02-080/3, 2002.
Prais, S.J. The Evolution of Giant Firms in Britain: A Study of the Growth of Concentration in Manufacturing Industry in Britain, 1909-70; Second Impression with a New Preface on Developments in 1970-76. Cambridge University Press, 1976.
Serrasqueiro, Z., P.M. Nunes, J. Leitão, and M. Armada. “Are there Non-Linearities between SME Growth and its Determinants? A Quantile Approach.†Industrial and Corporate Change 19, no. 4 (2010): 1071-108.
Sutton, J. “Gibrat’s Legacy.†Journal of Economic Literature 35, no. 1 (1997): 40-59.
Templeton, G.F. “A Two-Step Approach for Transforming Continuous Variables to Normal: Implications and Recommendations for IS Research.†Communications of the Association for Information Systems 28, no. 4 (2011): 41-58.
Tschoegl, A. E. “Size, Growth, and Transnationality among the World’s Largest Banks.†The Journal of Business 56, no. 2 (1983): 187-201.
Vlachvei, A., and O. Notta. “Firm Growth, Size and Age in Greek Firms.†Proceedings of International Conference on Applied Economics (2008): 915-21.
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2016-11-29
How to Cite
Harkati, R., & Mohamad, A. (2016). GIBRAT’S LAW AND LIQUIDITY CONSTRAINTS: EVIDENCE FROM MALAYSIA INDUSTRIAL SECTOR COMPANIES. International Journal of Economics, Management and Accounting, 24(2), 135–161. https://doi.org/10.31436/ijema.v24i2.357
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