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Growth and Profitability in Portuguese Companies: a Dynamic Panel Data Approach

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  • Zélia Serrasqueiro

    (Management and Economics Department, Beira Interior University, Covilhã, Portugal and CEFAGE Research Center Évora University, Portugal)

Abstract

In this article, using dynamic panel estimators, we test empirically the relationship between the growth of Portuguese companies and their profitability. The empirical evidence obtained indicates that growth in Portuguese companies means increased profitability. Growth in Portuguese companies is a catalysing factor of profitability, with the motivational effect on employees, given the expectation of greater gains in the future, being more relevant than the possible negative effects of growth on profitability, as a consequence of the need for new more formal labour relations in companies.

Suggested Citation

  • Zélia Serrasqueiro, 2009. "Growth and Profitability in Portuguese Companies: a Dynamic Panel Data Approach," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 11(26), pages 565-573, June.
    • Handle: RePEc:aes:amfeco:v:11:y:2009:i:26:p:565-574
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    References listed on IDEAS

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    1. Adelina Gschwandtner, 2005. "Profit persistence in the 'very' long run: evidence from survivors and exiters," Applied Economics, Taylor & Francis Journals, vol. 37(7), pages 793-806.
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    5. Adelina Gschwandtner, 2005. "Profit persistence in the 'very' long run: evidence from survivors and exiters," Applied Economics, Taylor & Francis Journals, vol. 37(7), pages 793-806.
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    7. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
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    Cited by:

    1. Sara Picas & Pedro Reis & António Pinto & José Luís Abrantes, 2021. "Does Tax, Financial, and Government Incentives Impact Long-Term Portuguese SMEs’ Sustainable Company Performance?," Sustainability, MDPI, vol. 13(21), pages 1-16, October.
    2. Hasan Ayaydin & Pinar Hayaloglu, 2014. "The Effect of Corruption on Firm Growth: Evidence from Firms in Turkey," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(5), pages 607-624, May.
    3. Vera Mota & Paulo Maçãs Nunes & António Fernandes de Matos, 2010. "New Construction and Reconstruction: Impact on Growth of Sub-Regions of Mainland Portugal," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 12(27), pages 169-176, February.
    4. Tibor Lalinsky, 2013. "Firm competitiveness determinants: results of a panel data analysis," Working and Discussion Papers WP 4/2013, Research Department, National Bank of Slovakia.

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    More about this item

    Keywords

    company growth; dynamic estimators; profitability;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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