A study on the effect of amalgamation on the cost behavior of local public enterprises / Shoichiro Hosomi and Shohei Nagasawa.

Hosomi, Shoichiro and Nagasawa, Shohei (2018) A study on the effect of amalgamation on the cost behavior of local public enterprises / Shoichiro Hosomi and Shohei Nagasawa. Asia-Pacific Management Accounting Journal (APMAJ), 13 (3). pp. 109-130. ISSN 2550-1631

Abstract

In this study, we focused on the amalgamations of local public enterprises and analyzed cost behavior before and after the amalgamations. From the perspective of cost management, it is possible that the amalgamations not only increase the burden of resource adjustment cost, but also make it more inefficient. For this reason, we classified management resources into tangible fixed assets, intangible fixed assets, and human resources to examine how each one affects the cost behavior of local public enterprises. As a result of our analysis, in local public enterprises, sticky costs after the amalgamation are stronger than before. It suggests that the larger management resources that resulted from the amalgamation increased the burden of the resource adjustment cost, which in turn strengthened sticky costs. Next, tangible fixed assets, which is the proxy index of material resources, has the effect of strengthening sticky costs after the amalgamation. Therefore, it is possible that the committed capacity cost increased even further with the amalgamation instead of improving the efficiency of the management. However, with respect to the hypothesis regarding intangible assets, we were unable to obtain significant results. Although various factors can be considered, since the types and nature of intangible fixed assets are diverse, it can be said that future studies such as analysis by each industry and ingenuity of analysis methods are necessary. On the other hand, we thought that human resources would act to strengthen sticky costs after the amalgamation, but this hypothesis was not supported. It is possible that, regarding human resources, the resource adjustment cost even decreases with amalgamations, weakening the influence of the costs.

Metadata

Item Type: Article
Creators:
CreatorsID Num. / Email
Hosomi, Shoichirohosomi@tmu.ac.jp
Nagasawa, Shoheinagasawa-shohei@ed.tmu.ac.jp
Subjects: H Social Sciences > HD Industries. Land use. Labor > Management. Industrial Management > Theory. Method. Relation to other subjects. > Management information systems. Decision support systems. Enterprise resource planning
H Social Sciences > HD Industries. Land use. Labor > Management. Industrial Management > Planning. Business planning. Strategic planning
H Social Sciences > HD Industries. Land use. Labor > Management. Industrial Management > Cost effectiveness
H Social Sciences > HD Industries. Land use. Labor > Management. Industrial Management > New business enterprises
Divisions: Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI)
Journal or Publication Title: Asia-Pacific Management Accounting Journal (APMAJ)
Journal: UiTM Journal > Asia-Pacific Management Accounting Journal (APMAJ)
ISSN: 2550-1631
Volume: 13
Number: 3
Page Range: pp. 109-130
Item ID: 29522
Uncontrolled Keywords: Amalgamation, Local public enterprises, Sticky costs
URI: http://ir.uitm.edu.my/id/eprint/29522

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