THE EFFECT OF FIRM SIZE ON PROFITABILITY: EVIDENCE FROM TURKISH MANUFACTURING SECTOR
| Autor: | Esra Aydin Unal, Yener Ünal, Özcan Işık |
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| Rok vydání: | 2017 |
| Předmět: |
Return on assets
business.industry Financial risk 05 social sciences Market liquidity Social Manufacturing 0502 economics and business Systematic risk Econometrics Size-profitability relationship dynamic panel data manufacturing industry Borsa Istanbul Turkey 050211 marketing Profitability index Business Endogeneity Sosyal 050203 business & management Panel data |
| Zdroj: | Volume: 6, Issue: 4 301-308 Journal of Business Economics and Finance |
| ISSN: | 2146-7943 |
| DOI: | 10.17261/pressacademia.2017.762 |
| Popis: | Purpose - This study investigates whether size of 112 publicly listed firms in manufacturing sector affects their profitability in Turkey during the period 2005-2013. Methodology - Dynamic panel data approach (i.e. two-step system GMM estimator) taking into account potential endogeneity of firm-level variables is employed to estimate the effect of alternative firm size indicators on firm profitability. Findings- Estimation results suggest that after controlling for financial risk, liquidity level, growth opportunities, unsystematic risk, firm age, and the other factors, the indicators of firm size measured by firm’s assets, sales and number of employees tend to have a positive influence on the profitability of firm measured by operating return on assets. Conclusion- There is enough statistical evidence to support a linear relation between firm size measures and profitability of firms in the period analyzed. However, our empirical results do not support the quadratic or cubic association between size measures and profitability. |
| Databáze: | OpenAIRE |
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