DOES FIRM AGE AFFECT PROFITABILITY? EVIDENCE FROM TURKEY
ELIF AKBEN-SELCUK
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
DOI: 10.52950/ES.2016.5.3.001
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APA citation:
ELIF AKBEN-SELCUK (2016). Does Firm Age Affect Profitability? Evidence from Turkey. International Journal of Economic Sciences, Vol. V(3), pp. 1-9. , DOI: 10.52950/ES.2016.5.3.001
Data:
Received: 15 Jun 2016
Revised: 9 Aug 2016
Accepted: 6 Sep 2016
Published: 20 Sep 2016
Copyright © 2016, Elif Akben-Selcuk et al, elif.akben@khas.edu.tr