Profitability of Turkish manufacturing firms: efficiency or market power?
Küçük Resim Yok
Tarih
2021
Yazarlar
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Yayıncı
Peter Lang AG
Erişim Hakkı
info:eu-repo/semantics/closedAccess
Özet
The relationship between efficiency, profitability and market power in the literature has developed on the basis of the efficient-structure (ES) hypothesis by Demsetz (1973) and the structure-conduct-performance (SCP or market power) hypothesis by Bain (1951) and Baumol (1982). This paper tests the different hypotheses explaining profitability in the generic framework of hypotheses of collusion versus efficiency, presenting as its main contribution the use of a direct measurement of efficiency. The analysis is performed on 115 firms operating in the Turkish manufacturing industry during the 2010-2019 period. The data is extracted from the Public Disclosure Platform (KAP) and firms balance sheet items. In order to test the hypotheses, the profit efficiency measures within the method of Bayesian Stochastic Frontier Analysis were used. In the empirical section, we perform a static and dynamic panel data approach to estimate the regression equations. The static and dynamic results show that there is a negative and significant relation between concentration and profitability for all industry, while a positive and significant relation between large firms' concentration ratio and profitability. We also find a positive and significant effect of profit efficiency on firm profitability. This supports the ES hypothesis in the Turkish manufacturing industry. © Peter Lang GmbH Internationaler Verlag der Wissenschaften Berlin 2021 All rights reserved.
Açıklama
Anahtar Kelimeler
Bayesian stochastic frontier analysis, Efficient-structure hypothesis, Profitability, Structure-conduct-performance hypothesis, Turkish manufacturing industry
