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Testing Gibrat’S Law On Croatian Freight Transport And Logistics Firms

Author

Listed:
  • Helga Pavlic Skender

    (University of Rijeka, Faculty of Economics)

  • Petra Adelajda Mirkovic

    (University of Rijeka, Faculty of Economics)

  • Vinko Zaninovic

    (University of Rijeka, Faculty of Economics)

Abstract

Gibrat’s law states that growth rate of the firm is independent of firm’s size. This paper tests Gibrat’s law on the panel data of Croatian freight transport and logistics firms during the period from 2006 to 2015. The data from Bureau van Dijk’s Amadeus database is used to test the Law. The sample includes 565 firms. The aim of the paper is to analyze whether the growth of the freight transport and logistics firms in Croatia depends of its size. The number of employees and sales of the firm are used as independent variables, while yearly sales growth is taken as the depended variable.In analysis is also included the age of the firm in order to control for variable other than the size that affect the growth rate of the firm. Using econometric model (fixed effects estimator) we find that there is statistically significant proportional connection between size of the firms and their respective growth rates, moreover the results shows the growth in number of employees has a positive impact on the growth rate while the growth in sales and age of the firm have negative impact on the growth rate. It means larger and older firms have slower growth rate. That is why the Gibrat’s law is rejected in case of Croatian freight transport and logistics firms.

Suggested Citation

  • Helga Pavlic Skender & Petra Adelajda Mirkovic & Vinko Zaninovic, 2017. "Testing Gibrat’S Law On Croatian Freight Transport And Logistics Firms," Business Logistics in Modern Management, Josip Juraj Strossmayer University of Osijek, Faculty of Economics, Croatia, vol. 17, pages 3-13.
    • Handle: RePEc:osi:bulimm:v:17:y:2017:p:3-13
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    References listed on IDEAS

    as
    1. D.B. Audretsch & L. Klomp & E. Santarelli & A.R. Thurik, 2004. "Gibrat's Law: Are the Services Different?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 24(3), pages 301-324, May.
    2. Sevgi Sezer & Tezcan Abasiz, 2017. "The Impact Of Logistics Industry On Economic Growth: An Application In Oecd Countries," Eurasian Journal of Social Sciences, Eurasian Publications, vol. 5(1), pages 11-23.
    3. Almus, Matthias & Nerlinger, Eric A, 2000. "Testing "Gibrat's Law" for Young Firms--Empirical Results for West Germany," Small Business Economics, Springer, vol. 15(1), pages 1-12, August.
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