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Profitability, Advertising Intensity and Concentration Ratio in Indonesian Cigarette Industry (2000 -2013)

Yulia Saftiana (), Benadette Robiani (), Syamsurijal A.k () and Suhel ()
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Yulia Saftiana: Lecturer, Sriwijaya University, Indonesia
Benadette Robiani: Lecturer, Sriwijaya University, Indonesia
Syamsurijal A.k: Lecturer, Sriwijaya University, Indonesia
Suhel: Lecturer, Sriwijaya University, Indonesia

Romanian Journal of Economics, 2018, vol. 47, issue 2(56), 34-48

Abstract: This study aimed to invest the relationship of structure, behavior and performance on cigarette industry in Indonesia. The variable used in this research is concentration ratio that used CR4 to measure industry structure, advertising intensity of four companies that included in CR4 to measure promotion behavior, Price Cost Margin (PCM) and profitability of four companies (ROS) included in CR4 to measure industry performance.Descriptive analysis between Price Cost Margin (PCM) and concentration of cigarette industry shows the direction of inconsistent relationship but for 23 years the direction of change is more positive than negative sign. Otherwise, the relationship between Return on Sales (ROS) with industrial concentration shows more negative sign than positive sign.

Keywords: advertising intensity; concentration ratio; price cost margin and return on sales (search for similar items in EconPapers)
JEL-codes: D31 D57 E64 (search for similar items in EconPapers)
Date: 2018
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Handle: RePEc:ine:journl:v:47:y:2018:i:56:p:34-48