"The Persistence of Accounting versus Economic Profit" by Matthew J. Holian

Selected Works of Matthew J. Holian

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Article

The Persistence of Accounting versus Economic Profit

Economics Bulletin (2010)

Matthew J. Holian, San Jose State University
Ali M. Reza, San Jose State University

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Abstract

Drawing on Schumpeterian theory, this article presents estimates of a first-order autoregressive model of profit persistence for large US firms, using Economic Value Added (EVA), the popular measure of profits produced by Stern Stewart and Company, and simple (unadjusted) accounting measures from the Compustat database. We hypothesize about the differences we should expect to find between these two sets of estimates, and also provide a fresh normative assessment of the dynamic competitiveness of the US economy.

Disciplines

Accounting and
Other Economics

Publication Date

2010

Publisher Statement

This article was published in Economics Bulletin, volume 30, issue 3, and can also be found online at this link.

Citation Information

Matthew J. Holian and Ali M. Reza. "The Persistence of Accounting versus Economic Profit" Economics Bulletin Vol. 30 Iss. 3 (2010) p. 2189 - 2196 ISSN: 1545-2921
Available at: http://works.bepress.com/matthew_holian/6/