Theory of Zipf’s Law and of General Power Law Distributions with Gibrat’s law of Proportional Growth

We summarize a book under publication with the above title written by the three present authors, on the theory of Zipf’s law, and more generally of power laws, driven by the mechanism of proportional growth. The preprint is available upon request from the authors. For clarity, consistence of language and conciseness, we discuss the origin and conditions of the validity of Zipf’s law using the terminology of firms’ asset values. We use firms at the entities whose size distributions are to be explained. It should be noted, however, that most of the relations discussed in this book, especially the intimate connection between Zipf’s and Gilbrat’s laws, underlie Zipf’s law in diverse scientific areas. The same models and variations thereof can be straightforwardly applied to any of the other domains of application. The authors acknowledge helpful discussions and exchanges with Xavier Gabaix. Corresponding author: D. Sornette, Chair of Entrepreneurial Risks ETH Zürich, KPL F 38.2, Kreuzplatz 5, 8032 Zürich , Switzerland. Tel: +41 44 63 28917 , Fax: +41