| dc.description.abstract | To explore the impact of changes in industry concentration on profitability and operational efficiency of non-financial listed companies in Taiwan, we use TEJ database to analyze all non-financial listed companies in Taiwan from 1981 to 2019. In this research, the minimum square method, fixed effect model, and the seemingly unrelated regression model were used. The results of this research show that Taiwan′s Herfindahl-Hirschman Index (HHI) is continually rising, and it is found that the higher the industrial concentration, the worse the profitability of the enterprise. The reason for the poor profitability is that the low operational efficiency, which may be due to the weak market competition caused by the high industrial
concentration. Therefore, if the enterprise ignores its operational efficiency, its profitability will be affected. We looked at each period and found that the negative situation mainly occurred between 1981 and 2006. However, after 2000, the industry whose industrial concentration is higher than others in Taiwan has the greater strength of profitability because of management efficiency. After 2000, Taiwanese enterprise set up factories in China, and greatly reduced its production costs, so its operating efficiency was improved, which also affected its strength of profitability. In addition, we also found that it won’t have excess profits after merging or acquiring a company with higher industry concentration. After 2000, when the major companies had higher revenue ratio, its operational efficiency was also
greater. Finally, we use the investment portfolio formed by the level of industrial concentration to analyze, and find that it is impossible to obtain excess returns through this investment method. | en_US |