The influence of the trade-off between profitability and future increases in sales on cost stickiness
Author
García Blandón, Josep
Argilés Bosch, Josep M.
Ravenda, Diego
Valencia Silva, Maika Melina
Somoza López, Antonio
Other authors
Universitat Ramon Llull. IQS
Publication date
2017-06Alternative title
La influencia del dilema entre rentabilidad inmediata y crecimiento futuro de las ventas en la histéresis de los costes
Abstract
This study analyses cost stickiness under the dilemma between current profitability and future sales increase. When activity decreases firms are faced to keep profitability adjusting resources, while they should also consider long term consequences and keep slack resources which allow building firms capacities to adapt to external challenges and take advantage of future opportunities. We find empirical evidence that changes in current firm profitability and one year ahead sales increase significantly influence resource adjustment in periods when sales decrease. We find a significant moderating effect of changes in profitability, as well as a significant stressing effect of one year ahead sales increase, on cost stickiness.
Document Type
Article
Published version
Language
English
Subject (CDU)
33 - Economics. Economic science
Keywords
Cost--Control
Beneficis
Vendes--Direcció i administració
Cost stickiness
Profitability
Increases--Sales
Pages
24 p.
Publisher
Universidad de Chile
Is part of
Estudios de Economía. Vol. 44, No.1 (2017), pág. 81-104
Note
Reproducció del document publicat a: https://estudiosdeeconomia.uchile.cl/index.php/EDE/article/view/45215
This item appears in the following Collection(s)
Rights
© Universidad de Chile
Except where otherwise noted, this item's license is described as http://creativecommons.org/licenses/by-nc-sa/4.0/