EconStor >
Bard College, Annandale-on-Hudson (NY) >
Levy Economics Institute of Bard College >
Working Papers, Levy Economics Institute of Bard College >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/23235
  

Full metadata record

DC FieldValueLanguage
dc.contributor.authorZacharias, Ajiten_US
dc.date.accessioned2009-01-29T15:51:25Z-
dc.date.available2009-01-29T15:51:25Z-
dc.date.issued2001en_US
dc.identifier.urihttp://hdl.handle.net/10419/23235-
dc.description.abstractLong-run differentials in interindustrial profitability are relevant for several areas of theoretical and applied economics because they characterize the overall nature of competition in a capitalist economy. This paper argues that the existing empirical models of competition in the industrial organization literature suffer from serious flaws. An alternative framework, based on recent advances in the econometric modeling of the long run, is developed for estimating the size of long-run profit rate differentials. It is shown that this framework generates separate, industry-specific estimates of two potential components of long-run profit rate differentials identified in economic theory. One component, the noncompetitive differential, stem from factors that do not depend directly on the state of competition; these factors are generally characterized as risk and other premia. The other component, the competitive differential, is due to factors that directly depend on the state of competition (factors such as degree of concentration and economies of scale). Estimates provided here show that during the period under study, the group of industries with statistically insignificant competitive differentials accounted for 72 percent of manufacturing profits and 75 percent of manufacturing capital stock, which is interpreted as lending support to the theories of competition advanced by the classical economists and their modern followers.en_US
dc.language.isoengen_US
dc.relation.ispartofseriesWorking papers / Bard College, Jerome Levy Economics Institute 321en_US
dc.subject.ddc330en_US
dc.subject.stwRentabilit├Ąten_US
dc.subject.stwVerarbeitendes Gewerbeen_US
dc.subject.stwUSAen_US
dc.titleTesting Profit Rate Equalization in the U.S. Manufacturing Sector: 1947-1998en_US
dc.typeWorking Paperen_US
dc.identifier.ppn503883832en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:Working Papers, Levy Economics Institute of Bard College

Files in This Item:
File Description SizeFormat
wp321.pdf379.4 kBAdobe PDF
No. of Downloads: Counter Stats
Show simple item record
Download bibliographical data as: BibTeX

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.