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The Cost of Failed Businesses in The Gilded Age: Applying Power Laws to Business Failures in the late 19th Century United States

Wayne Zandbergen 

George Mason University (GMU), Fairfax 22030, United States

Abstract

Power laws have descriptive properties in several areas of economic analysis. This article describes interesting power law relationships derived from business failure statistics accumulated in the late 19th Century United States. Analysis of empirical data for multiple years shows that the value of business failures, accumulated by year and by state, consistently presents as a 2-regime power law, with the regime boundary occurring in the same rank location over several years. Further analysis showing other patterns in the accumulated data is presented along with suggestions why these properties may be relatively unique to this period in time. Further implications for simulation of historical economic patterns are examined with particular focus on the interplay between the geopolitical categories used to measure the analyzed statistics as well as the historical development of business in the post-bellum era.

 

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  1. FULLTEXT: The Cost of Failed Businesses in The Gilded Age: Applying Power Laws to Business Failures in the late 19^{th} Century United States, Microsoft Office Document, 0.1MB
 

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Presentation: Oral at International Conference on Economic Science with Heterogeneous Interacting Agents 2008, by Wayne Zandbergen
See On-line Journal of International Conference on Economic Science with Heterogeneous Interacting Agents 2008

Submitted: 2008-03-04 18:49
Revised:   2009-06-07 00:48