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- Title
Managerial risk appetite and asymmetry cost behavior: evidence from China.
- Authors
Ziyang Li; Qianwei Ying; Yuying Chen; Xuehui Zhang
- Abstract
Managerial risk preferences have considerable impacts on a firm's costmanagement through committed resource adjustment decisions.We investigate whether a firm's cost behaviour is influenced bymanagers' risk appetite and find that cost stickiness increases with managers' risk-seeking. The positive relationship between riskseeking and cost stickiness is weaker for firms with higher levels of manager capacity.We further find that the moderating effect of managerial capacity ismore pronounced in non-state-owned enterprises, in less competitive industries, and in areas with lower degrees of marketisation. These results suggest that managers' personal characteristics are key factors that affect sticky cost behaviour.
- Subjects
CHINA; COST; COST control; PERSONAL managers
- Publication
Accounting & Finance, 2020, Vol 60, Issue 5, p4651
- ISSN
0810-5391
- Publication type
Article
- DOI
10.1111/acfi.12692