What Causes Firm Profitability Variation in the EU Food Industry? A Redux of Classical Approaches of Variance Decomposition

Hirsch, Stefan; Schiefer, Jan

doi:10.1002/agr.21430

Cited by 33 publications

(21 citation statements)

References 49 publications

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“…The assessment of competitiveness from a microeconomic point of view is usually based on traditional performance indicators (in the agri‐food sector, e.g., Bezat‐Jarzębowska & Rembisz, ; Madau, ). Firm‐specific factors are also considered as the key sources of firm performance in agribusiness sectors (e.g., Blažková & Dvouletý, ; Chaddad & Mondelli, ; Hirsch & Schiefer, ; Hirsch, Schiefer, Gschwandtner, & Hartmann, ). Therefore, we selected the indicators of performance based on the profit, value‐added and costs that can be considered as applicable outcome variables to assess the competitiveness of firms, that is, PCM , ROA , Value Added per Labour cost and Growth of Labour Costs .…”

Section: Data and Empirical Approachmentioning

confidence: 99%

Assessing the microeconomic effects of public subsidies on the performance of firms in the czech food processing industry: A counterfactual impact evaluation

Dvouletý

Blažková

2018

Agribusiness

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The effects of European innovation and cohesion policies are very uneven throughout both regions and industries. Moreover, there are often only descriptive impact assessments of individual programmes available. In our study, we respond to this issue through the empirical analysis of the effects of the EU public policy on the example of the Czech food processing industry. We assess the impact of the Opera-Agribusiness. 2019;35:394-422. wileyonlinelibrary.com/journal/agr 394 |

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Section: Data and Empirical Approachmentioning

confidence: 99%

Assessing the microeconomic effects of public subsidies on the performance of firms in the czech food processing industry: A counterfactual impact evaluation

Dvouletý

Blažková

2018

Agribusiness

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“…COV is based on the assumption that the effect levels in the analyzed sample are randomly chosen from the population of levels (Searle et al, 2006;. In addition, ANOVA results are highly sensitive to the chosen pattern of effect introduction (Hirsch & Schiefer, 2016). Finally, both ANOVA and COV do not account for possible correlations between individual effects (Misangyi et al, 2006).…”

Section: Methodsmentioning

confidence: 99%

What drives firm profitability? A multilevel approach to the Spanish agri-food sector

Zouaghi¹,

Sánchez

Hirsch

2017

Span. j. agric. res.

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Strategic management research has demonstrated the importance of firm-and industry structure as drivers of firm profitability. However, less is known about how firms´ geographical locations affect profitability. Applying a multi-level approach of hierarchical linear modeling we estimated firm-, industry-, and region-specific effects on profitability of 3,273 agri-food firms operating in different Spanish districts over the time span 2006-2013. The results reveal the dominance of firm-specific effects which contribute up to 48.8% to variance in firm profitability while the contribution of industry effects (0.8-4.2%), geographical location (0.1-1.8%), and year effects (0.1-2.5%) is rather small. Moreover, firm size, risk, and innovative activity turn out as significant profit drivers at the firm level. Although firm-effects outweigh industry-and region-specific factors, the results indicate that industry concentration as well as regional education and unemployment influence profitability. In addition, proximity to technological institutes as well as the degree of urbanization of the region in which a firm operates can be drivers of profitability. Hence, despite the superiority of firm effects the results indicate that agri-food managers should also consider possible advantages from location-based resources in order to ensure competitiveness.Additional keywords: agri-food profits; firm-, industry-, and location effects; hierarchical linear model.

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“…Blažková & Dvouletý, 2018b;Chaddad & Mondelli, 2013), the most variability of the firm performance is explained by the firm-level determinants (e.g. Goddard et al, 2009;Hirsch & Schiefer, 2016).…”

Section: Introductionmentioning

confidence: 99%

Sectoral and Firm-Level Determinants of Profitability: A Multilevel Approach

Blažková

Dvouletý

2018

IJEK

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The paper aimed to contribute to the literature on the determinants of firm profitability, from the perspective of the Czech economy. We followed a multilevel/hierarchical approach towards the analysis of the sectoral and firm-level determinants of the profitability of companies operating in the Czech food processing industry during years 2005-2012 (622 Firms in 10 Sectors). We assessed an impact of industry (i.e. market concentration, sector growth rate and growth rate of imports) and firm-level characteristics (i.e. market share, firm age, firm size, number of employees, debt/equity ratio and short-term risk) on the return on assets (ROA). Surprisingly, there were no substantial differences between the separate models for industry and firm-level determinants and a combined one. We found a positive impact of market concentration and market share and a negative effect of age and risk-taking behaviour on a firm profitability. Based on these findings, managers in the Czech food and drink industry should pay more attention to the debt policy. KEYWORDS: firm profitability; return on assets (ROA); industry and firm effects; multilevel analysis; Czech food and drink industry.JEL CLASSIFICATION: L11, L66, D22

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What Causes Firm Profitability Variation in the EU Food Industry? A Redux of Classical Approaches of Variance Decomposition

Cited by 33 publications

References 49 publications

Assessing the microeconomic effects of public subsidies on the performance of firms in the czech food processing industry: A counterfactual impact evaluation

Assessing the microeconomic effects of public subsidies on the performance of firms in the czech food processing industry: A counterfactual impact evaluation

What drives firm profitability? A multilevel approach to the Spanish agri-food sector

Sectoral and Firm-Level Determinants of Profitability: A Multilevel Approach

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