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Profits in the long-term for the manufacturing sector

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  • Manuel Espitia-Escuer

Abstract

It is foreseeable that the integration of domestic economies into a single market (globalization) will have a direct consequence on firm profits. Firms will see their returns converge in the long-term towards an equilibrium value that is identical to that of diverse firms coming from other economies. The authors' objective is to test the existence of a process of convergence between economies. Thus, they analyze the evolution of the competitive process of the manufacturing sector in eight countries. The results suggest that even though the competitive forces that operate at an international level will result in the convergence of the respective returns of firms in the long-term, the convergence process is only partial. (JEL 16) Copyright International Atlantic Economic Society 2003

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  • Manuel Espitia-Escuer, 2003. "Profits in the long-term for the manufacturing sector," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 9(3), pages 233-247, August.
    • Handle: RePEc:kap:iaecre:v:9:y:2003:i:3:p:233-247:10.1007/bf02295447
    DOI: 10.1007/BF02295447
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    1. Geroski, Paul A & Jacquemin, Alexis, 1988. "The Persistence of Profits: A European Comparison," Economic Journal, Royal Economic Society, vol. 98(391), pages 375-389, June.
    2. Mueller,Dennis C., 2009. "Profits in the Long Run," Cambridge Books, Cambridge University Press, number 9780521101592.
    3. Schohl, Frank, 1990. "Persistence of profits in the long run: A critical extension of some recent findings," International Journal of Industrial Organization, Elsevier, vol. 8(3), pages 385-404, September.
    4. Sumantra Ghoshal, 1987. "Global strategy: An organizing framework," Strategic Management Journal, Wiley Blackwell, vol. 8(5), pages 425-440, September.
    5. Mueller, Dennis C, 1977. "The Persistence of Profits above the Norm," Economica, London School of Economics and Political Science, vol. 44(176), pages 369-380, November.
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