The Relationship between External and Internal Performance Measures of the Firm: A Reassessment by the Econometrics of Dynamic Non-Stationary Panels (La Relation Entre Les Mesures De Performance Externes Et Internes De La Firme: Un Réexamen Par L’Économétrie Des Panels Dynamiques Non Stationnaires)

27 Pages Posted: 18 Jun 2009 Last revised: 22 Jun 2009

See all articles by Chawki Mouelhi

Chawki Mouelhi

University of Quebec at Rimouski - Department of Management Sciences

Jacques Saint-Pierre

Laval University

Date Written: April 21, 2009

Abstract

This article uses the recent developments in the econometrics of non-stationary dynamic panels to reassess the relationship between external and internal performance measures of the firm. The test of Im, Pesaran and Shin (2003) and the test of Pedroni (2004) were applied on a sample of 420 U.S. firms over the period (1990-2004) to verify the existence of a long term equilibrium between the market value added (MVA) of the firm and four measures of internal performance.

Note: Downloadable document is in French.

Keywords: EVA, EPS, Residual income, ROE, MVA, Non-stationary dynamic panels

JEL Classification: C5, M41, G32

Suggested Citation

Mouelhi, Chawki and Saint-Pierre, Jacques, The Relationship between External and Internal Performance Measures of the Firm: A Reassessment by the Econometrics of Dynamic Non-Stationary Panels (La Relation Entre Les Mesures De Performance Externes Et Internes De La Firme: Un Réexamen Par L’Économétrie Des Panels Dynamiques Non Stationnaires) (April 21, 2009). Available at SSRN: https://ssrn.com/abstract=1421599 or http://dx.doi.org/10.2139/ssrn.1421599

Chawki Mouelhi

University of Quebec at Rimouski - Department of Management Sciences ( email )

Rimouski, Quebec G5L 3A1
Canada

Jacques Saint-Pierre (Contact Author)

Laval University ( email )

School of Business
Palasis-Prince Building
Quebec, Quebec G1K 7P4
Canada
418-839-9964 (Phone)

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