Is Market Power or Efficiency behind Economic Performance? The Case of the Czech Food Processing Industry

This article attempts to identify the main reason for profitability of Czech food processing companies. For this purpose, an analysis industry was carried out in framework Structure–Conduct–Performance (SCP) paradigm; specifically, relative market power (RMP) hypothesis versus efficiency tested. The used data at micro-economic level six Nomenclature Economic Activities (NACE) sub-sectors period 2016–2020. final dataset consisted 2639 observations 623 came from database Bisnode Albertina and Statistical Office. Stochastic frontier (SFA) a regression model were study. Based on research out, performance does not seem be explained by greater represented firm’s share. Only one sub-sector proven have higher marginal effect than technical efficiency. Thus, it can concluded that companies with relatively larger shares do thus achieve profitability.