Quotation Gschwandtner, Adelina, Lambson, Val E. 2012. Sunk Costs, Depreciation, and Industry Dynamics. Review of Economics and Statistics 94 (4): 1059-1065.




Two of the most robust results from dynamic competitive models of industrial organization suggest that higher-sunk-cost industries should exhibit higher intertemporal variability in the market value of their firms and lower intertemporal variability in the size of their industries. These predictions have done well empirically. This paper argues on theoretical and empirical grounds that depreciation generates countervailing effects.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal Review of Economics and Statistics
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new FIN-A, VW-A, WH-A
Language English
Title Sunk Costs, Depreciation, and Industry Dynamics
Volume 94
Number 4
Year 2012
Page from 1059
Page to 1065
Reviewed? Y


Gschwandtner, Adelina (Former researcher)
Lambson, Val E
Institute for Statistics and Mathematics IN (Details)
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