Does Firm Age Affect Profitability? Evidence from Turkey

Elif Akben-Selcuk ()
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Elif Akben-Selcuk: Kadir Has University

International Journal of Economic Sciences, 2016, vol. 5, issue 3, 1-9

Abstract: The objective of this study is to investigate the impact of firm age on the profitability of Turkish firms listed on Borsa Istanbul. Using a dataset covering the years between 2005 and 2014 and consisting of 302 non-financial firms per year on the average, a fixed effects model with robust standard errors is estimated. Results reveal that there is a negative and convex relationship between firm age and profitability measured by return on assets, return on equity or gross profit margin. This suggests that younger firms start to see a decline in their profitability from the beginning but they may become profitable again at an old age. Implications are provided.

Keywords: Firm age; firm life cycle; financial performance; profitability; fixed effects model; emerging markets; Turkey (search for similar items in EconPapers)
JEL-codes: C23 G30 L20 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (18)

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Persistent link: https://EconPapers.repec.org/RePEc:sek:jijoes:v:5:y:2016:i:3:p:1-9

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