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Argilés Bosch, Josep M. [Author]; García Blandón, Josep [Author]; Ravenda, Diego [Author]; Valencia-Silva, Maika M. [Author]; Somoza, Antonio D. [Author]

The influence of the trade-off between profitability and future increases in sales on cost stickiness

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  • Media type: E-Article
  • Title: The influence of the trade-off between profitability and future increases in sales on cost stickiness
  • Parallel title: La influencia del dilema entre rentabilidad inmediata y crecimiento futuro de las ventas en la histéresis de los costes
  • Contributor: Argilés Bosch, Josep M. [Author]; García Blandón, Josep [Author]; Ravenda, Diego [Author]; Valencia-Silva, Maika M. [Author]; Somoza, Antonio D. [Author]
  • Published: June 2017
  • Published in: Estudios de economía ; 44(2017), 1 vom: Juni, Seite 81-104
  • Language: English
  • Identifier:
  • Keywords: Cost stickiness ; profitability ; increases in sales ; slack ; resource adjustment ; Aufsatz in Zeitschrift
  • Origination:
  • Footnote: Zusammenfassung in spanischer Sprache
  • Description: 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.
  • Access State: Open Access