Anwar Shaikh's theory of turbulent arbitrage predicts that incremental profit rates will tend to equalize across sectors, albeit in a noisy and turbulent fashion. He supports the claim with plots of time series of average and incremental profit rates for US sectors. This paper applies a Kolmogorov-Smirnov two-sided test to pairs of sectoral profit rate time series, drawing on Shaikh's data. The results support Shaikh's claim.
Keywords: turbulent arbitrage; real competition; profit rates; Kolmogorov-Smirnov test
JEL classification: C14 E12 E22
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