Toward a general theory of competitive dominance : comments and extensions on Powell
- UK : Wiley, April 2005
In a recent paper, Powell ([2003]) studied 20-year performance in 21 industries, using an ordinal performance measure (wins), and the Gini coefficient as a measure of competitive dominance. The findings suggest that firm performance is statistically indistinguishable from performance in non-business domains such as politics, games, sports, and pageants. This paper extends these findings, developing the statistical foundations for a general theory of competitive dominance. The paper presents a Gibrat-based null hypothesis, develops a decomposable index of competitive dominance, and suggests statistical procedures and empirical methods for future research.
Competitive dominance Likelihood ratio Decomposition