A1101
Title: Does the adjustment cost of future resource expansion affect labor cost stickiness?
Authors: Wuqing Wu - Renmin University of China (China) [presenting]
Guoliang Chen - Renmin university (China)
Abstract: Cost stickiness is an important topic in management accounting, and the cost of adjusting resources is one of the main reasons for cost stickiness. However, existing studies have mainly explored the adjustment cost related to the current resource reduction and paid less attention to the adjustment cost related to the future resource expansion. Based on the background of China's subway construction, it is explored whether the opening of subway stations affects firms' labor cost stickiness. It is found that the opening of subway stations can significantly reduce the cost of hiring employees, thus reducing firms' labor cost stickiness. The cross-sectional test also shows that the effect of subway station opening on labor cost stickiness is more pronounced for firms with high labor demand and low labor supply.
