Marketing intensity and persistence of firm performance: empirical evidence from Indonesia

Dinesh Jaisinghani, Harwinder Kaur, Jatin Goyal and Mahesh Joshi

International Journal of Productivity and Performance Management, 2019, vol. 69, issue 6, 1109-1127

Abstract: Purpose - The purpose of this paper is to examine the degree of persistence of firm performance for publicly listed firms in Indonesia. The study also explores the impact of marketing expenditure on firm’s performance. Design/methodology/approach - The data comprise 165 listed firms operating in Indonesia over the period 2007–2016. Dynamic panel regression estimations using Arellano and Bond (1991) and Blundell and Bond (1998) techniques have been deployed to generate the results. Findings - The findings show the existence of positive persistence and sub-optimal level of competition in the performance of Indonesian firms. The results highlight that marketing intensity has a positive and significant impact on firm performance. The positive persistence hints at creation of substantial entry and exit barriers by the Indonesian firms and also indicate that Indonesian firms are able to create behavioral inertia among their consumers by properly directing their marketing efforts. Practical implications - There is a need on the part of management to strengthen the short-term profit capabilities to nurture long-term benefits of profit maximization. On the regulators part, the authorities should frame the policies to foster long-run competition. Originality/value - The current study contributes to the sparse literature on persistence of firm performance in the context of emerging economies like Indonesia. This is the first study on persistence of firm performance for publicly listed firms in Indonesia.

Keywords: Indonesia; Emerging markets; Dynamic panel; Profit persistence; Marketing intensity (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:ijppmp:ijppm-02-2019-0072

DOI: 10.1108/IJPPM-02-2019-0072

Access Statistics for this article

International Journal of Productivity and Performance Management is currently edited by Dr Luisa Huatuco and Dr Nicky Shaw

More articles in International Journal of Productivity and Performance Management from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().