(The) relationship between cost behavior and efficiency : based on empirical evidence from Korean stock markets = 원가행태와 기업 효율성 간의 관계 : 한국 상장기업을 중심으로based on empirical evidence from Korean stock markets
Strategic resource distribution and efficient use of limited resources are important. In research, cost behavior is an indicator of such investment strategy patterns. Previous studies have attributed the asymmetry of cost behavior to management expectations. When managers expect that future sales revenue will increase, they put up with surplus expenses to avoid adjustment costs. In this research, we analyzed whether or not the cost behavior stemming from these choices is related to future efficiency in the case of sales increase. We divided KOSPI and KOSDAQ samples with sales increase into stickiness and anti-stickiness groups and compared future efficiency. In the case of the KOSPI market, the stickiness group had higher future efficiency than the anti-stickiness group. On the contrary, in the case of the KOSDAQ market, the anti-stickiness group had higher future efficiency than the stickiness group. Our results elucidate the relationship between cost behavior and efficiency, and imply the existence of distinct characteristics in Korean stock markets. The value of this research is in that it extends cost behavior research and furthers understanding of cost behavior for its use as firm information.