Profit Margin And Capital Structure: An Empirical Relationship

This study constitutes an attempt to investigate the relationship between debt-to equity ratio and firm’s profitability, taking into consideration the level of firms’ investment and the degree of market power.  The study uses panel data for various industries, covering the period 1995-96.  The main conclusions of our study are: a) firms which prefer to finance their investment activities through self-finance are more profitable than firms which finance investment through borrowed capital; b) firms prefer competing with each other than cooperating; c) firms use their investment in fixed assets as a strategic variable to affect profitability

The Banks’ profitability – concentration relationship in an era of financial integration

This paper investigates the impact of concentration ratio of the Greek commercial banking market on banks’ return on equity; that is, it examines the structure – conduct – performance (SCP) hypothesis. This examination is performed by estimating a relationship that combines time series and cross-sectional data over the period 1993-1997. To accomplish this task we use panel data procedure and consider the total model, the fixed effect model and the random effect model. The leverage multiplier, the asset utilization, an expense ratio and a productivity ratio are employed as a vector of control variables that may differ across banks, or time periods. The empirical results indicate that the financial variables are important determinants of banks’ profitability. However, their impact appears to differ across banks. This finding reveals the different importance that the banks place to financial factors. Moreover, market structure is found to have no influence on banks’ performance, which suggests that the existing competition among Greek banks is not bounded by the market structure.peer-reviewe

Competition in tourism among the Mediterranean countries

This paper examines tourism competition among the Mediterranean countries with particular emphasis on Greece. The estimated model includes as explanatory variables an income index, a price index of the host country, a price index of the competitors (Spain, Portugal and Italy) and exchange rate. The results show that the main determinants of Greece's tourism demand are both price indexes and exchange rate. They also show that Spain seems to be Greece's main competitor.