Özet:

This study aims to analyze inter-relationship between firm profitability, growth and size by using quarterly data of Turkish manufacturing industry consisting of Borsa Istanbul (BIST) listed manufacturing firms covering 1991.Q2-2014.Q4. In the study, to test the stationarity of series and the co-integration relationship between them, unit root test of Carrioni-i-Silvestre et. al. (2009) and co-integration test of Maki (2012) are used, respectively. Co-integration coefficients are estimated by means of Stock and Watson (1993)’s dynamic ordinary least squares (DOLS) method. Finally, causal relationships between the series are tested by Hacker and Hatemi-J (2012) bootstrap causality test. Structural break dates estimated point out dramatic turning points in Turkish economy. Maki (2012) test results show that the series are co-integrated in the long-run. Long-run parameters estimated by DOLS method posit a significantly negative relationship between profitability and size. Causality test results indicate the existence of one-way causality from size to profitability.

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