A Structural Equation Model of the Relationship between Advertising, Profitability and Size

Nagaraj Sivasubramaniam, Ali Kara

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Scopus citations

Abstract

According to conventional theories, advertising intensity promotes product differentiation, leading to higher barriers to entry and higher profits. Previous research has attempted to test the relationship between advertising and profitability using historical and experimental approaches. However, these relationships have not been examined over a period of time; hence no causality can be imputed to the variables of interest. Based on COMPUSTAT data for 131 firms in the consumer goods industries, this study examined the relationships between advertising, profitability and sales over a three year period using LISREL.

Original languageEnglish (US)
Title of host publicationDevelopments in Marketing Science
Subtitle of host publicationProceedings of the Academy of Marketing Science
PublisherSpringer Nature
Pages547-552
Number of pages6
DOIs
StatePublished - 2015

Publication series

NameDevelopments in Marketing Science: Proceedings of the Academy of Marketing Science
ISSN (Print)2363-6165
ISSN (Electronic)2363-6173

All Science Journal Classification (ASJC) codes

  • Marketing
  • Strategy and Management

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