Global evidence on the distribution of economic profit rates

Williams, Michael A.; Baek, Grace; Park, Leslie Y.; Zhao, Wenyun

doi:10.1016/j.physa.2016.04.027

Cited by 8 publications

(4 citation statements)

References 19 publications

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“…There are several tests available to determine whether a sample comes from a normally distributed population. Those theory-driven tests include the Kolmogorov-Smirnov test [10,11], Anderson-Darling test [12,13], Cramer-von Mises test [14,15], Shapiro-Wilk test [16,17], and Shapiro-Francia test [18,19]. The first three tests are based on the empirical cumulative distribution.…”

Section: Methodsmentioning

confidence: 99%

Implementation Kolmogorov-Smirnov Method on Queue System Simulation

2021

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Long queue always happen as main problem in re-registration of new students who passed the New Registration Student (NRS). The long queue makes the queueing system crowded and cannot be controlled properly. This research is aimed in knowing the model, process simulation model and how to use the method of Kolmogorov-Smirnov of system for re-registration of new students. The method is suitable on how to solve long queue system with new model and simulation. The proposed method is implemented in Senior High School in Padang, West Sumatera, Indonesia. The result of this research shows that after we divided queuing post 1 into two sub-posts namely post 1a and 1b on the first day and we note that average long applicants waiting at post 1a and 1b are smaller i.e. 2.3 minutes and 2.8 seconds as previously for 15 minutes. Furthermore, we divided queuing post 2 into 2 sub-posts namely post 2a and 2b on first day note that average long applicants wait at post 1a and 1b are smaller i.e. 0.2 minutes and 0.2 minutes as previously for 32 minutes. It can be concluded that the solution to the registration posts can make an average registration time waiting to be smaller.

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Section: Methodsmentioning

confidence: 99%

Implementation Kolmogorov-Smirnov Method on Queue System Simulation

2021

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“…Concretely, we see the Lévy noise as a representation of the firm or sector specific idiosyncratic shocks. Indeed, firm size growth rates are known to be well approximated by heavy-tail distributions with infinite variance [20]. A priori, it is not clear that fluctuations of individual firms (or sectors) would have a significant impact on aggregate measures for the economy.…”

Section: Growth Rate Fluctuations As Confined Lévy Flightsmentioning

confidence: 99%

Gross domestic product growth rates as confined Lévy flights: Towards a unifying theory of economic growth rate fluctuations

Lera¹,

Sornette

2018

Phys. Rev. E

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A new model that combines economic growth rate fluctuations at the microscopic and macroscopic level is presented. At the microscopic level, firms are growing at different rates while also being exposed to idiosyncratic shocks at the firm and sector level. We describe such fluctuations as independent Lévy-stable fluctuations, varying over multiple orders of magnitude. These fluctuations are aggregated and measured at the macroscopic level in averaged economic output quantities such as GDP. A fundamental question is thereby to what extend individual firm size fluctuations can have a noticeable impact on the overall economy. We argue that this question can be answered by considering the Lévy fluctuations as embedded in a steep confining potential well, ensuring nonlinear mean-reversal behavior, without having to rely on microscopic details of the system. The steepness of the potential well directly controls the extend towards which idiosyncratic shocks to firms and sectors are damped at the level of the economy. Additionally, the theory naturally accounts for business cycles, represented in terms of a bimodal economic output distribution, and thus connects two so far unrelated fields in economics. By analyzing 200 years of US GDP growth rates, we find that the model is in good agreement with the data.

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“…Recently, some authors (see [17][18][19]) proposed a new focus to analyse firm dynamics from Gibrat's perspective beyond the growth rates of firm size. They claim that a more informative quantity to account for the dynamics of the ensemble of firms in a competitive environment is to consider profit rates instead of growth rates as the key measure of firm performance.…”

Section: Introductionmentioning

confidence: 99%

A Cross-Sectional Analysis of Growth and Profit Rate Distribution: The Spanish Case

et al. 2022

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We analyse the time evolution of the empirical cross-sectional distribution of firms’ profit and growth rates. In particular, we analyse the conditional properties of the empirical distributions depending on the size of the firms and the business cycle phase. In order to do so, we employ the Laplace distribution as a benchmark, further considering the Subbotin and Asymmetric Exponential Power (AEP hereafter) distributions, to capture the potential asymmetry and leptokurtosis of the empirical distribution. Our results show that the profit rates of large firms are characterised by an asymmetric Laplace distribution with parameters largely independent of the business cycle phase. Small firms, instead, are characterised by the AEP distribution, which accounts for the conditional dependence of distribution on the phase of the business cycle. We observe that the largest firms are more robust to downturns compared to the small firms, given their invariant distributional characteristics during crisis periods.

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Global evidence on the distribution of economic profit rates

Cited by 8 publications

References 19 publications

Implementation Kolmogorov-Smirnov Method on Queue System Simulation

Implementation Kolmogorov-Smirnov Method on Queue System Simulation

Gross domestic product growth rates as confined Lévy flights: Towards a unifying theory of economic growth rate fluctuations

A Cross-Sectional Analysis of Growth and Profit Rate Distribution: The Spanish Case

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