Investigating the mediating role of cost stickiness in the relationship between management's personal motivations and investment inefficiency

Articles in Press

Document Type : Original Article

Authors

1 Assistant Professor of Accounting, Department

2 Associate professor of Accounting Payame Noor University, Iran

3 MSc. in Accounting, Payame Noor University, Iran.

10.22034/iaas.2023.388187.1438

Abstract

Investment inefficiency is caused by information asymmetry and agency theory. Managers' opportunistic motives lead to information asymmetry and deviation of the company from optimal investments. In other words, managers may seek to maximize their personal benefits through cost management. This behavior of managers will lead to asymmetric and ineffective investment. The present research was conducted with the aim of investigating the mediating role of cost stickiness in the relationship between management's personal motivations and investment inefficiency. In this research, the data of 1024 company-years from the companies admitted to the Iran Stock Exchange during the years 2014 to 2021 were used. The results of the multiple regression test, taking into account the fixed effects of year and industry, showed that Personal motivations and cost stickiness affect investment inefficiency, And in fact, the main finding of the current research showed that cost stickiness has a mediating role in the relationship between management's personal motivations and investment inefficiency.

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Accounting and Auditing Studies

Articles in Press, Accepted Manuscript
Available Online from 15 April 2024

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