Skip to main content

On Modelling the Persistence of Profits in the Long Run: A Test of the Standard Model for 156 US Companies, 1950–99

Cable, John R, Gschwandtner, Adelina (2008) On Modelling the Persistence of Profits in the Long Run: A Test of the Standard Model for 156 US Companies, 1950–99. International Journal of the Economics of Business, 15 (2). pp. 245-263. ISSN 1466-1829. (doi:10.1080/13571510802134411) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided) (KAR id:40509)

The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided. (Contact us about this Publication)
Official URL
http://dx.doi.org/10.1080/13571510802134411

Abstract

‘Persistence of profits’ studies of competitiveness across samples of firms, and for individual firms, have almost always employed a simple first order autoregression model. Reservations over the use and interpretation of the AR1 in this context raise questions both over the reliability of previous results, and for future research strategy. We test the standard model on a common sample of 156 US companies over a 50 year period against a recently proposed, alternative model that adopts structural time series methods. A statistically significant degree of consistency is found between the two approaches in identifying firms persistently above or below the competitive norm in the long run. However, the structural time series method detects a much higher overall incidence of persistence, and appears to offer advantages in cases where the profit dynamics are more complex.

Item Type: Article
DOI/Identification number: 10.1080/13571510802134411
Additional information: number of additional authors: 1;
Uncontrolled keywords: Profit Persistence, Competition, Structural Time Series
Subjects: H Social Sciences
H Social Sciences > HB Economic Theory
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Stewart Brownrigg
Date Deposited: 07 Mar 2014 00:05 UTC
Last Modified: 01 Feb 2020 04:05 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/40509 (The current URI for this page, for reference purposes)
Gschwandtner, Adelina: https://orcid.org/0000-0002-6952-1782
  • Depositors only (login required):