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dc.contributor.advisorWang, Chong
dc.contributor.authorNeels, Tom
dc.dateSep-14
dc.date.accessioned2014-12-05T20:10:37Z
dc.date.available2014-12-05T20:10:37Z
dc.date.issued2014-09
dc.identifier.urihttp://hdl.handle.net/10945/43962
dc.descriptionApproved for public release; distribution is unlimiteden_US
dc.description.abstractWang and San Miguel report that U.S. defense contractors earn excessive profits relative to their industry peers. This work provides the first evidence that this phenomenon is not restricted to the United States. By applying Wang and San Miguel’s innovative industry-year-size match, we found that German defense contractors earn economically significant, excessive profits. The comparison between German and U.S. defense contractors revealed similar patterns in both countries. The statistical evidence for excessive profitability is stronger for the measurements return on assets (ROA) and return on common shareholder’s equity (ROCE), while the findings for profit margin ratio (PMR) and operating margin ratio (OMR) are statistically less significant. The comparison of the regulatory environment of the United States and Germany showed that the contracting rules of both countries emphasize competition among defense contractors, but the perspectives on and uses of profit and fees differ for cost-based contracts. In the United States, profit and fees are used to share the risk of rising costs between defense contractors and the government. In the German system, profit for defense contracts is calculated by the Bonner Equation. This difference could be a reason for the more pronounced excessive profits in Germany.en_US
dc.publisherMonterey, California: Naval Postgraduate Schoolen_US
dc.rightsThis publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. As such, it is in the public domain, and under the provisions of Title 17, United States Code, Section 105, may not be copyrighted.en_US
dc.titleExcessive profits of German defense contractorsen_US
dc.typeThesisen_US
dc.contributor.secondreaderRendon, Rene G.
dc.contributor.departmentSystems Acquisition Management
dc.subject.authordefense contractoren_US
dc.subject.authordefense industryen_US
dc.subject.authorexcessive profitabilityen_US
dc.subject.authorGermanyen_US
dc.subject.authorindustry-year-size matchen_US
dc.subject.authorprofiten_US
dc.subject.authorROAen_US
dc.subject.authorROCEen_US
dc.description.recognitionOutstanding Thesisen_US
dc.description.serviceLieutenant Commander, German Navyen_US
etd.thesisdegree.nameMaster of Business Administrationen_US
etd.thesisdegree.levelMastersen_US
etd.thesisdegree.disciplineBusiness Administrationen_US
etd.thesisdegree.grantorNaval Postgraduate Schoolen_US


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