Intra-Industry Profitability Differences in US Manufacturing 1953-1983

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Over the period 1953-83, twelve accounting measures of profitability, which are not on average highly correlated, imply measures of the profitability advantage of large firms that move closely together. All twelve measures decline significantly and substantially over this entire period; there is no acceleration in the 1970s. All measures move counter-cyclically. Together with recent work on the dynamics of the inter-industry concentration-profitability relation, these results point to the existence of important pro-cyclical industry-level changes in the strength of the concentration-profitability relation.