We attempt to gain a better perspective on evolving firm-size in the past twenty years across industries by combining Brynjolfsson, Malone, Gurbaxani, and Kambil (1994, BMGK)’s empirical framework of measuring the effect of coordination cost reduction due to information technology (IT) investment, and Kumar, Rajan, and Zingales (2001)’s synopsis of theories of the firm. We find that although in...

Why do firm growth and exit rates decline with size? What determines the size distribution of firms? This paper presents a theory of firm dynamics that simultaneously rationalizes the basic facts on firm growth, exit, and size distributions. The theory emphasizes the accumulation of industry specific factors in response to industry specific productivity shocks. The emphasis on the accumulation ...

This paper studies the relationship between firm size and the optimal organization structure by extending the two-division model of Alonso et. al (2008) to finite number of divisions. The firm must resolve the tradeoff between coordination and adaptation; relevant information for decision making is dispersed and communication is strategic. We compare the overall performance of centralization an...

It is often difficult to predict how a change in a firm’s corporate governance structure will affect the future value of the firm. We examine what factors are associated with the level of stock market uncertainty surrounding a change in composition of the board of directors by investigating the variations in market reaction to a director resignation announcement. Market uncertainty is measured ...

This paper relates firm size and opportunism by showing that, given certain behavioral dispositions of humans, the size of a profit-maximizing firm can be determined by cognitive aspects underlying firminternal cultural transmission processes. We argue that what firms do better than markets – besides economizing on transaction costs – is to establish a cooperative regime among its employees tha...

We model the firm as a type of artificial neural network that plays a repeated Cournot game. Each period the firm must learn to map environmental signals to both demand parameters and it’s rival’s output choice. In this paper, though, this Cournot game is in the ’background,’ as we focus on the endogenous adjustment of network size. We investigate the long-run behavior of firm/network size as a...

journal of accounting advances (j.a.a) vol. 5, no. 1, 2013, ser. 64/3     extended abstract   monitoring role of auditing and corporate dividend payout policies   dr. v. khodadadi              s. hajizadeh               r. ghorbani shahid chamran university of ahvaz   introduction the aim of this paper is to investigate the relation between monitoring role of independent auditing and corporate ...

The paper investigates the differences between small, medium-sized and large firms regarding their performance in the introduction of new products and processes. After a review of the relevant literature, two models are proposed and tested in search for different business strategies and innovation inputs connected to product and process innovations. The empirical analysis uses innovation survey...

Sutton (1998) has recently proposed a theoretical lower bound to firm size inequality when a market is made of several independent submarkets. His results are valid asymptotically, as the number of submarkets becomes arbitrarily large. We show that, in small samples, his results can be interpreted as a positive relationship between an index of firm size inequality and the number of submarkets. ...