Industry variables with profit as the dependent variable (performance)

Term paper requirements:


Before submitting the term paper, students will be guided through step by step by presenting each component part separately for evaluation by the professor as follows:

The Industry name and its 6-digit NAICS code, the purpose, and a brief background

NOTE: This assignment is not gradable. The assigned grade will indicate whether you have provided the information below.

Identify the name of the industry that you will base your term paper on and its corresponding 6 NAICS digit code. In a single paragraph, state the following:

The name of your industry

The six- digit NAICS code

How you plan to collect your data (source). See industry access data.

The purpose of your paper

Brief background of your industry.


For example, the purpose of this research paper is to describe an industry in term s of its structure, conduct and performance. A list of possible industries is shown on Page 205 in your text Book. State whether your industry caters for the local and foreign markets.

The Theoretical section explaining the relationship between Industry performance and each of the explanatory variables of structure and conduct.

Theoretical Framework. This assignment is not gradable

For this week, you will focus on the theoretical framework; don’t start to collect the data as yet. This phase of your paper is explanatory or theoretical.

Theoretical Framework refers to how each independent variable is related to performance, a measure of profitability.

This section identifies the dependent variable and the independent variables.

The Dependent Variable is the Industry Performance. A typical measure of performance is Net Revenue

Independent Variables include the elements of market structure and market conduct (see chapter 7)

1. CR4

2. Technology

3. Demand and Market Conditions

4.Potential for entry

CONDUCT (pricing strategy): Define and list the elements of conduct

Pricing behavior


Research and Development

Define and the explain how each independent variable influence industry performance.

For example, CR4 or concentration ratio is a measure of the percentage of industry sales controlled by top large four companies. If the CR4 exceeds at least 70 percent of industry sales, then these companies as a group can restrict sales, raise prices and thus result in high profits for the industry. Hence, the relationship between CR4 and Profitability id positives.

NEXT: offer at least two scholarly articles of how others (existing literature) describe such a relationship as well. This  will be part of your reference page. You should have at least two scholarly articles.

Do the same for technology, market conditions, and pricing (define, and explain the type of relationship

Next week, we will focus on collecting data on the industry for at least 10 years.

Data collection and sources of secondary data

Data Collection

Before you start to do the write up of your Term Paper, you should have a plan. I will recommend that you do a pre-stage as follows before you start to write. This pre-stage will serve as an outline/guide to do your term paper write-up.

Pre stage: Industry variables with profit as the dependent variable (performance)

Identify the name of the industry that you wish to investigate and its six-digit code.

The variables that you wish to examine for your industry is based on a paradigm- a framework that you will use to examine the evidence of the industry. This framework is called the Structure-Conduct -Performance, following porter’s five forces of an industry’s profitability in the long run. The variable that represents the performance of an industry is profit for at least a 10- year period (long -run). Use the table below to collect data for 10 years.

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