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The pattern of changes in the long-term development of establishment size

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Abstract

Hypotheses and analyses dealing with the expansion of small businesses are usually carried out over relatively short periods of time. The patterns drawn from these examinations, e.g., on the question of specific differences in the growth of size, are usually influenced by configurations of the overall economy and limit the realization of regular processes to the phases they are based upon. A second disadvantage lies in most cases in the fact that data sources are used for the empirical analyses that do not cover the economic system as a whole nor for all sizes of establishments. This study attempts to present the development of the sizes of establishments in Germany over a period of more than one hundred years (1882 to 1987) and thus avoids the narrow perspective of previous examinations. It becomes evident that this development does not take a continuous course; instead, it follows a wave pattern. Since this discontinuous development pattern is common to almost all sectors, it appears to be a general phenomenon. This study reveals that the small establishments with more than five employees, contrary to most theoretical assumptions, are of utmost importance even when considered over a long period of time. The growth of small establishments in recent years, observable in all sectors, may not be a unique phenomenon; however, in view of an overall growth of employment and the simultaneous shrinking of large establishments, it occurs under a new constellation.

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... Davidsson et al, 1994a). 4. The roles and relative importance of firms and establishments in different size classes vary over time in shorter and longer cycles (Kirchhoff & Phillips, 1991; Stockmann & Leicht, 1994). Policies geared towards a certain size class runs the risk of being wrong most of the time. ...
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[fre] Les très grandes firmes ont pendant longtemps constitué le domaine de recherche privilégié du courant de « l'Industrial Organization ». Cependant, une vague d'études récentes a non seulement considéré que les petites firmes jouent un rôle accru sur les marchés industriels, mais encore que leur fonction économique est différente de celle des grandes entreprises. Le but de cet article est de relier ces études qui, rassemblées, constituent un nouvel apprentissage du rôle des petites firmes sur les marchés industriels. En particulier, le rôle des petites firmes sous des conditions d'analyse statique dans le courant de l'I.O. est contrasté au rôle dynamique qu'une analyse évolutionniste permet de mettre en évidence. [eng] The focus of analysis in industrial organization has traditionally been on the largest firms comprising industries. However, a recent wave of studies has not only identified that small firms are playing an increased role in industrial markets, but that their economic function is distinct from that of larger enterprises. The purpose of this paper is to weave together these studies which, combined together, constitute a new learning with respect to the role of small firms in industrial markets. In particular, the role of small firms under static analysis in the industrial organization literature is contrasted to the dynamic role that emerges when viewed through a more evolutionary lens.
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