Knowledge, Profitability and Exit of German Car Manufacturing Firms

Jens Krüger () and Kristina Dreßler ()
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Kristina Dreßler: University of Jena, Faculty of Economics

No 15/2006, Jenaer Schriften zur Wirtschaftswissenschaft (Expired!) from Friedrich Schiller University of Jena, School of of Economics and Business Administration

Abstract: In this paper the profitability of German car manufacturing firms is related to different indicators for the knowledge incorporated in the firms since the birth of the industry in 1886. The analysis is performed with an ordered probit model, where information about the kind of exit of the firms is exploited to construct a latent profitability variable. Knowledge is represented by the number of patents, learning-by-doing and entrepreneurial experience before entry. The results show that knowledge is significantly positively related to firm profitability and that each of the three knowledge forms exerts an independent effect.

Keywords: firms profitability; exit modes; knowledge; ordered choice; automobile industry (search for similar items in EconPapers)
JEL-codes: C25 L10 L21 L62 O33 (search for similar items in EconPapers)
Date: 2006-05-20
New Economics Papers: this item is included in nep-dcm, nep-ent, nep-ino and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:jen:jenasw:2006-15

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