Product differentiation and systematic risk: theory and empirical evidence Reportar como inadecuado




Product differentiation and systematic risk: theory and empirical evidence - Descarga este documento en PDF. Documentación en PDF para descargar gratis. Disponible también para leer online.

Abstract

Firms producing differentiated products have high margins and therefore low risk. As a result firms invest more into developing differentiated products when they perceive risk is high. Higher risk also implies higher product skewness towards more differentiated products and therefore higher average markups. The model predicts endogenous systematic and idiosyncratic riskiness as well as endogenous intensity of competition: firms in high risk industries reduce their riskiness by competing less than firms in low risk industries. Empirical evidence on product differentiation, R\andD expenses, B-M ratios, and market $\beta$ is consistent with the model.



Item Type: MPRA Paper -

Original Title: Product differentiation and systematic risk: theory and empirical evidence-

Language: English-

Keywords: Stock Returns, Price Differentiation, Product Market Competition, Product Development, Idiosyncratic Volatility, Research and Development, Counter-Cyclical Markups, Price of Risk, Price-Cost Margin, Investment, Innovation-

Subjects: L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L25 - Firm Performance: Size, Diversification, and ScopeL - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L16 - Industrial Organization and Macroeconomics: Industrial Structure and Structural Change ; Industrial Price IndicesL - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L11 - Production, Pricing, and Market Structure ; Size Distribution of FirmsG - Financial Economics > G1 - General Financial Markets > G12 - Asset Pricing ; Trading Volume ; Bond Interest RatesE - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations ; CyclesE - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E22 - Investment ; Capital ; Intangible Capital ; CapacityG - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy ; Financial Risk and Risk Management ; Capital and Ownership Structure ; Value of Firms ; GoodwillO - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O31 - Innovation and Invention: Processes and Incentives-





Autor: Bazdresch, Santiago

Fuente: https://mpra.ub.uni-muenchen.de/35504/







Documentos relacionados