Growth and evolution of technical efficiency among entrant versus incumbent firms: the Spanish retail sector

This study investigates two objectives using a cohort approach: first, the firms' growth and, second, the technical efficiency of entrant and incumbent firms with a non-parametric approach, keeping in mind changes in the Spanish retail environment. The results obtained suggest, on the one hand, that evidence suggested by Gibrat's Law has not been fully proven. In this sense, smaller firms within their cohort membership grow faster than larger ones. On the other hand, our results indicate significant differences in the efficiency by sector. In this sense, entrant and incumbent firms shift the frontier in non-specialized and specialized sectors, respectively.