The Evolution Of Firm Size and Employment Share Distribution in Japanese and UK Manufacturing: A Study of Small Business Presence

This paper traces the changing contribution of small firms to manufacturing in Japan and the UK between 1972 and 1992. It shows that there are significant and important differences between the two countries, although in both cases small firms provided an increasing share of the total stock of firms over the period. In the UK however small firms also increased their employment share, primarily at the expense of large firms whilst in Japan their share remained constant. On of the most striking differences is the fact that in the UK only the very smallest micro businesses achieved a net increase in numbers, whereas in Japan all sizes of firm recorded an increase in numbers, albeit at declining rates by firm size.