Review of Effect of Management Ability on Costs Stickiness in Tehran Stock Exchange

Javad Rezaei, Mohammad Imani Barandagh


New theories regarding cost behavior suggest that costs increase more when activity rises than they decrease when activity falls by an equivalent amount. This kind of behavior is known as “cost stickiness”. The statistical population is consisted of all firms listed in TSE in the 7-year time-period from 2007 to 2013, among which 88 firms have been selected as the sample group. In order to examine the hypotheses, regression analysis of the panel data has been carried out. The results suggest that in there is a significant relationship between earnings management and cost stickiness in the studied period. In other words, managerial Ability would increase cost stickiness in the firms. Therefore, efforts to identify factors affecting cost structures in firms should take into account the manager’s abilities in making decision regarding costs and resources, especially decisions motivated by agency costs.


Costs stickiness, Management Ability, CGS, SGA.

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