The evolution of the firm size distribution and nationality of ownership

It has recently been shown that the firm size distribution is initially skewed to the right and then evolves over time to become more lognormal, and argued that this is likely due to firms initially facing financial constraints, see Cabral and Mata (2003). We conjecture that, it this is true, then such a pattern should be much less apparent for multinational companies for which financial constraints arer generally considered to be lower than non-multinationals. Moreover, such a difference may be re-enforced by the fact that multinationals are less likely to face selection issues. These propositions are confirmed usingplant level Irishman ufacturing data.