Cost Stickiness and Anti-Cost Stickiness of Non- Manufacturing Costs in Iranian Firms

Cost stickiness denotes the asymmetric response of costs to sales increases versus sales decreases. In this paper, we also consider the concept of cost anti-stickiness. Cost anti-stickiness happens when the decrease of costs in case of a fall in sales is more than the increase of costs due to an equal rise in sales. This phenomenon happens because of existence of optimistic managers in past years and inefficient stickiness cause of sales volatility against manager’s expectation. This paper examines the cost stickiness and anti-cost stickiness of nonmanufacturing costs in Iranian firms using panel data analysis. The sample includes 229 publicly-traded firms listed in Tehran Stock Exchange. Using data for 2012-2015, the results showed that not only do the nonmanufacturing costs have stickiness behavior but also they have antistickiness behavior that occurs due to the changes in the sales in the previous years.