BeschreibungThe present study is the first that investigates profit persistence in the European food industry. Belgium, France, Italy, Spain and the United Kingdom are analyzed in terms of food industry profit persistence during the period 1996 to 2008. The results suggest that profits tend to converge towards a competitive norm. However, this process is far from completion. According to our findings a significant number of firms earn profits above or below the competitive norm in the long run. The highest degree of profit persistence is revealed for the UK. Overall the average degree of persistence seems to be considerably lower compared to other manufacturing sectors. Determinants influencing profit persistence significantly positive are industry size, industry growth and contrary to the results for other manufacturing sectors firm size. Firms age, its risk and, surprisingly, the R&D intensity were identified as significant negative determinants.
|31 Aug. 2011 → 2 Sept. 2011
|38th Conference of the European Association for Research in Industrial Organization (EARIE)