Persistence of firm‐level profitability in the European dairy processing industry |
| |
Authors: | Stefan Hirsch Monika Hartmann |
| |
Affiliation: | Institute for Food and Resource Economics, University of Bonn, , Nussalle 21, D‐53115 Bonn, Germany |
| |
Abstract: | Based on autoregressive (AR) models and Arellano‐Bond dynamic panel estimation, this article analyses profit persistence in the European dairy processing industry. The sample comprises 590 dairy processors from the following five countries: Belgium, France, Italy, Spain, and the United Kingdom. The AR models indicate that cooperatives which account for around 20% of all firms in the dairy processing sector are not primarily profit oriented. In addition, the results point toward a high level of competition as profit persistence is rather low even if cooperatives are excluded. The panel model reveals that short‐ as well as long‐run profit persistence is influenced by firm and industry characteristics. |
| |
Keywords: | L12 L66 M21 Profit persistence Competition Dairy processing industry |
|
|