Same as it ever was, really? An empirical study on the sustainability of superior performance of public companies in the US and in Europe from 1987 to 2007

Boris Durisin () and Riccardo Lizzola
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Boris Durisin: Management Department, Bocconi University, Milan, Italy
Riccardo Lizzola: Bocconi University, Milan, Italy

No 11, KITeS Working Papers from KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy

Abstract: Theorizing on hypercompetition and temporary advantages calls for developing theory and empirical evidence about whether and why competitive advantages may be becoming less sustainable. Our study attempts to contribute to such an endeavour by examining 1319 firms in United States and 700 firms in some European countries for the period 1987 to 2007. In the last twenty years, growth rather than margins, industry, market share and size has exhibited most influence in explaining total shareholder return in the United States and in Europe. Sustainability of superior performance is not found neither in the United States nor in Europe. In addition, the results show a pervasive increase in volatility and rank order fluctuation both at the firm and the industry level. It is not that what managers face today is the same as it ever was. Theorizing on margin-based rents and in turn the value of the ideas of their proponents face a lack of empirical support.

Keywords: performance stability, hypercompetition; industry and firm effects (search for similar items in EconPapers)
Pages: 49 pages
Date: 2009, Revised 2009
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