**1. Introduction**

In the growth path literature that uses Gibrat's Law, there are few studies that analyze campsites, and none that investigate Norwegian campsites. Previous studies of Italian and Dutch campsites do not reject Gibrat's Law, using an OLS framework on a sample of five years. This study uses a GMM (and ML) framework on a sample with twice the time dimension, although we have a smaller cross-sectional sample. The composition of the sample is also different, as Italian (Piergiovanni et al. 2003) and Dutch (Audretsch et al. 2004) campsites do not face the same degree of natural (and state) restrictions as Norwegian ones do, in addition to being larger than Norwegian ones. Unlike the previous literature, the present paper uses a detailed and accurate methodology to test Gibrat's Law. We hope to supplement the existing literature with our findings about the growth of businesses that work under these conditions, using a modernized framework.

The tourism industry is important for many countries and contributes to value creation and employment; accordingly, there is a relatively large amount of existing literature on the subject. Although campsites are an important contributor to this industry in Europe, North America, Australia, and parts of Asia, few analyses have tested Gibrat's Law for this segment.

It is of great interest to see if Gibrat's Law applies to the tourism industry in Norway, as Norway is moving towards a future in which it will be less dependent on oil. Therefore,

**Citation:** Valenta, Robin, Johannes Idsø, and Leiv Opstad 2021. Evidence of a Threshold Size for Norwegian Campsites and Its Dynamic Growth Process Implications—Does Gibrat's Law Hold? *Economies* 9: 175. https:// doi.org/10.3390/economies9040175

Academic Editors: Aleksander Panasiuk and Robert Czudaj

Received: 13 August 2021 Accepted: 5 November 2021 Published: 10 November 2021

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the focus must be on other industries The tourism industry is important for ensuring future sustainable regional development (NOU 2020). Therefore, the authorities need more knowledge about the campsites, among other things. For example, will the growth be distributed equally, or will there be a concentration around the large companies? The purpose of this article is to find out more about this, and related, issue(s).

The article in which Gibrat proposes the Law of Proportional Effect (LPE) (Gibrat 1931) has formed the basis for many research articles, and it states that an individual firm's relative growth is independent of firm size. Consequently, the best prediction one can make about any individual firm's size the next year will be that firm's current size, plus the growth in the relevant sector. If the year-to-year growth of large firms is 5%, it will be 5% for small firms as well. This does not mean that all firms grow at the same pace, but that the growth is independent of firm size.

The market concentration of industries and sectors is an essential topic in economics, thus how the distribution of market share changes over time is important. This dynamic is why the LPE has received so much attention, as it serves as the baseline with which to compare the growth dynamic in different industries and sectors. Any deviation from Gibrat's Law is evidence of the market at hand converging, at the extreme, towards perfect competition or monopoly. In most cases, when Gibrat's Law is rejected, it is rejected in favour of the mean reversion, although the very long run distribution of firms is often observed to be logarithmic rather than normal. This is due to the fact that sectors act more in accordance with Gibrat's Law the older they become.
