This study examines whether or not there is an optimal firm size for publicly traded US hotels. More specifically, the study tests a threestage relationship based on economies and diseconomies of scale: The first stage, in which firm value increases as firm size increases; the second stage, in which firm value remains constant as firm size increases beyond the first stage; and the third stage, in which firm value decreases as firm size transcends the second stage. The study uses the Newey-West heteroskedasticity and the autocorrelation consistent (HAC) standard errors estimation in pooled regression analysis. Findings partially support the proposed relationship.
All Science Journal Classification (ASJC) codes
- Geography, Planning and Development
- Tourism, Leisure and Hospitality Management