<title>Abstract</title> <italic>The present paper analyzes the determinants of profit persistence using a newly developed methodology that allows the persistence parameter to vary with time. It therefore addresses a significant limitation of previous persistence models, which have assumed unrealistically that...</italic>

'Persistence of profits' studies of competitiveness across samples of firms, and for individual firms, have almost always employed a simple first order autoregression model. Reservations over the use and interpretation of the AR1 in this context raise questions both over the reliability of...