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HOMEOSTATIC TENDENCIES OF FIRM-SIZE DISTRIBUTIONS AND THE EVOLUTION OF ECONOMIC SYSTEMS

STABILITE DES DISTRIBUTIONS DE TAILLES D'ENTREPRISES ET EVOLUTION DES SYSTEMES ECONOMIOUES

P. WINIWARTER * and B. ROEHNER

Abstract : Stable skewed distributions of subsystem-Sizes are observed in a variety of biological, sociological and economic systems (Zipf's law, ranksize rule, Pareto-law). Based on a fundamental mathematical property of Pareto distributions a theoretical explanation is proposed, which applies to hierarchically organized systems in general. As supporting evidence the analysis of empirical data concerning evolution of firm -Size distributions of the 500 largest U.S. industrial corporations over the last 25 years is presented.