Factors influencing price-cost margins are investigated using a rich panel data base of the Dutch manufacturing sector. Attention is devoted to the intertemporal stability of the relationship explaining price-cost margins and to a comparison with U.S. results. Our results indicate that isolated cross-section analyses can be misleading. Evidence is provided for similarities and dissimilarities between the U.S. and the Netherlands when explaining price-cost margins. Dutch margins are influenced by industry-specific factors such as sales changes, import competition, capital intensity and operating expenses. Domestic seller concentration, aggregate capacity utilization and export intensity play no distinct roles.

Netherlands, USA, averaged panel data, cyclical influences, manufacturing, price-cost margins
dx.doi.org/10.1007/BF01035659, hdl.handle.net/1765/9669
Review of Industrial Organization
Erasmus School of Economics

Prince, Y.M, & Thurik, A.R. (1994). The intertemporal stability of the concentration-margins relationship in Dutch and U.S. manufacturing. Review of Industrial Organization, 9(2), 193–209. doi:10.1007/BF01035659