This article searches for a causal effect of industry concentration on estimates of persistent profitability differentials. I offer solutions to identification problems that plague related analyses by applying an IV and a natural experiment. This is the first study that explains estimates of...

This article discusses the treatment of fixed capital in Classical theory of price. Sraffa uses non-linear depreciation of “physical” capital that equalizes all annual profit rates individually, but violates the proportionality of monetary machine value reduction and physical use-up on an...