Economic Review, Vol. 69 No. 3, 2018.
Preliminary communication
GIBRAT’S LAW AND JOVANOVIC’S LEARNING THEORY: AN EMPIRICAL TEST FOR SMALL FIRMS IN A POSTCONFLICT ECONOMIC SETTING
Besnik A. Krasniqi
Saranda Lajqi
Abstract
This article tests the validity of Gibrat’s Law and Jovanovic’s learning theory for growing small and medium-sized firms (SMEs) in post-conflict economy of Kosovo. Despite evolving body of evidence suggesting that Gibrat’s Law does not hold, there is a lack of empirical evidence from transitional and post-conflict economies. This study provides econometric analysis of the relationship of age, size and growth of SMEs. The article is based on pooled SME surveys conducted by Riinvest Institute (2004- 2006). Econometric findings show that Gibrat’s Law does not hold in all model specifications while support the conventional Jovanovic’s learning theory based on growth-size age model suggesting important policy implications for promotion of small firms in Kosovo.
Keywords
size; age; Gibrat’s Law; Jovanovic’s learning theory; growth; SMEs; Kosovo
Hrčak ID:
202517
URI
Publication date:
20.6.2018.
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