A New Methodology of Measuring Firm Life-Cycle Stages

International Journal of Economic Perspectives, Forthcoming

15 Pages Posted: 12 Oct 2006 Last revised: 18 Mar 2010

See all articles by Zhipeng Yan

Zhipeng Yan

New Jersey Institute of Technology

Yan Zhao

Brandeis University

Multiple version iconThere are 2 versions of this paper

Date Written: September 1, 2009

Abstract

Corporate life-cycle concept is widely used in a variety of disciplines, including management, economics and accounting, and also in the real-world investment. However, current commonly used methodologies of measuring life-cycle stages are either only suitable for small sample studies or only applicable in cross-sectional analysis of corporations over life-cycle stages. None of them can be employed in large-sample, time-series analysis. This paper develops a new methodology which makes the study of large-sample time-series properties within each stage a possibility, by comparing a corporation's status at each point of its development with its own historical overall status. We use real-world financial accounting data to illustrate and validate our methodology.

Keywords: Life cycle

JEL Classification: B41, C63, C81, M21, M31, G30

Suggested Citation

Yan, Zhipeng and Zhao, Yan, A New Methodology of Measuring Firm Life-Cycle Stages (September 1, 2009). International Journal of Economic Perspectives, Forthcoming, Available at SSRN: https://ssrn.com/abstract=893826 or http://dx.doi.org/10.2139/ssrn.893826

Zhipeng Yan (Contact Author)

New Jersey Institute of Technology ( email )

United States

Yan Zhao

Brandeis University ( email )

Waltham, MA 02454
6171559261 (Phone)

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