What Do We Know About Variance in Accounting Profitability?
AbstractIn this paper, we analyze the variance of accounting profitability among a broad cross-section of forms in the American economy from 1981 to 1994. The purpose of the analysis is to identify the importance of year, industry, corporate-parent, and business-specific effects on accounting profitability among operating businesses across sectors. The findings indicate that industry and corporate-parent effects are important and related to one another. As expected, business-specific effects, which arise from competitive positioning and other factors, have a large influence on performance. The analysis reconciles the results of previous studies by exploring differences in method and data. We also identify the broad contributions and limitations of the research, and suggest avenues for further study. New approaches are necessary to generate significant insights about the relationships between industry, corporate-parent, and business influences on firm profitability.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by INFORMS in its journal Management Science.
Volume (Year): 48 (2002)
Issue (Month): 7 (July)
performance; sustainability; industry structure; corporate strategy;
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Margarita Katsimi & Sarantis Kalyvitis & Thomas Moutos, 2009. ""Unwarranted" Wage Changes and the Return on Capital," CESifo Working Paper Series 2804, CESifo Group Munich.
- Caldart, Adrian A. & Ricart, Joan E., 2006. "A formal evaluation of the performance of different corporate styles in stable and turbulent environments," IESE Research Papers D/621, IESE Business School.
- Mary E. Graham & Julie L. Hotchkiss, 2008. "Elimination of gender-related employment disparities through statistical process control," Working Paper 2008-24, Federal Reserve Bank of Atlanta.
- Vaaler, Paul M. & McNamara, Gerry, 2006. "Are Technology-Intensive Industries More Dynamically Competitive? No and Yes," Working Papers 06-0124, University of Illinois at Urbana-Champaign, College of Business.
- K. O’Shaughnessy & Eric Gedajlovic & Patrick Reinmoeller, 2007. "The influence of firm, industry and network on the corporate social performance of Japanese firms," Asia Pacific Journal of Management, Springer, vol. 24(3), pages 283-303, September.
- Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2005.
"How well do institutional theories explain firms'perceptions of property rights?,"
Policy Research Working Paper Series
3709, The World Bank.
- Meghana Ayyagari & Asli Demirgüc-Kunt & Vojislav Maksimovic, 2008. "How Well Do Institutional Theories Explain Firms' Perceptions of Property Rights?," Review of Financial Studies, Society for Financial Studies, vol. 21(4), pages 1833-1871, July.
- Meghana Ayyagari & Thorsten Beck & Asli Demirguc-Kunt, 2007.
"Small and Medium Enterprises Across the Globe,"
Small Business Economics,
Springer, vol. 29(4), pages 415-434, December.
- Diaz-Diaz, Nieves Lidia & Aguiar-Diaz, Inmaculada & De Saá-Pérez, Petra, 2008. "The effect of technological knowledge assets on performance: The innovative choice in Spanish firms," Research Policy, Elsevier, vol. 37(9), pages 1515-1529, October.
- Kolias, Georgios D. & Dimelis, Sophia P. & Filios, Vasilios P., 2011. "An empirical analysis of inventory turnover behaviour in Greek retail sector: 2000-2005," International Journal of Production Economics, Elsevier, vol. 133(1), pages 143-153, September.
- Chen, Yi-Min, 2010. "The continuing debate on firm performance: A multilevel approach to the IT sectors of Taiwan and South Korea," Journal of Business Research, Elsevier, vol. 63(5), pages 471-478, May.
- Ricart, Joan E. & Enright, Michael J. & Ghemawat, Pankaj & Khanna, Tarun & Hart, Stuart L., 2003. "New frontiers in international strategy," IESE Research Papers D/532, IESE Business School.
- Graham, Mary E. & Hotchkiss, Julie L., 2009. "A More Proactive Approach to Addressing Gender-related Employment Disparities in the United States," MPRA Paper 44795, University Library of Munich, Germany.
- Jorge Tarziján M, 2002. "La Ventaja Competitiva De La Empresa Revisada," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 5(1), pages 31-50.
- Boland, Michael A. & Pendell, Dustin L., 2005. "Persistence of Profitability in Family-Owned Food Businesses," 2005 Annual meeting, July 24-27, Providence, RI 19216, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- 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.
- Ketelhöhn, Niels W. & Quintanilla, Carlos, 2012. "Country effects on profitability: A multilevel approach using a sample of Central American firms," Journal of Business Research, Elsevier, vol. 65(12), pages 1767-1772.
- Julia, 2011. "About some difficulties with interpreting and measuring corporate performance," Bank i Kredyt, National Bank of Poland, Economic Institute, vol. 42(5), pages 41-60.
- Goddard, John & Tavakoli, Manouche & Wilson, John O.S., 2009. "Sources of variation in firm profitability and growth," Journal of Business Research, Elsevier, vol. 62(4), pages 495-508, April.
- G Johnes & Jill Johnes, 2009. "Strategic Responses to Companies'' Own Past Performance: Why do some Firms Fare Better Than Others?," Working Papers 602555, Lancaster University Management School, Economics Department.
- repec:lan:wpaper:1107 is not listed on IDEAS
- Juan Carlos Bou & Albert Satorra, 2003. "The persistence of abnormal returns at industry and firm levels," Economics Working Papers 729, Department of Economics and Business, Universitat Pompeu Fabra.
- Jan Schiefer & Stefan Hirsch & Monika Hartmann & Adelina Gschwandtner, 2013. "Industry, firm, year and country effects on profitability in EU food processing," Studies in Economics 1309, Department of Economics, University of Kent.
- repec:lan:wpaper:1029 is not listed on IDEAS
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.