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What drives the profitability of Japanese multi-business corporations? A variance components analysis

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  • Fukui, Yoshitaka
  • Ushijima, Tatsuo

Abstract

This article decomposes the business-level profit rate of Japanese multi-business corporations by performing a variance components analysis on a large sample of publicly traded non-financial firms in 1998-2003. Consistent with US evidence, estimation results demonstrate that profitability is predominantly determined by business-level factors, not corporate-level ones, suggesting that a typical multi-business corporation in Japan is a combination of relatively distinct businesses in terms of profit.

Suggested Citation

  • Fukui, Yoshitaka & Ushijima, Tatsuo, 2011. "What drives the profitability of Japanese multi-business corporations? A variance components analysis," Journal of the Japanese and International Economies, Elsevier, vol. 25(2), pages 1-11, June.
    • Handle: RePEc:eee:jjieco:v:25:y:2011:i:2:p:1-11
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    References listed on IDEAS

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    Cited by:

    1. Takata, Hidesuke, 2016. "Effects of industry forces, market orientation, and marketing capabilities on business performance: An empirical analysis of Japanese manufacturers from 2009 to 2011," Journal of Business Research, Elsevier, vol. 69(12), pages 5611-5619.
    2. Bart S. Vanneste, 2017. "How Much Do Industry, Corporation, and Business Matter, Really? A Meta-Analysis," Strategy Science, INFORMS, vol. 2(2), pages 121-139, June.

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