E3S Web Conf.
Volume 235, 20212020 International Conference on New Energy Technology and Industrial Development (NETID 2020)
|Number of page(s)||4|
|Section||Industrial Technology Development and Industrial Structure Adjustment and Upgrading|
|Published online||03 February 2021|
Manager Overconfidence and Cost Stickiness
Beijing Jiaotong University, Beijing, China
China market economy is in a new period of structural deceleration. Factors, such as fierce external competition and the advancement of the globalization process have put Chinese companies under enormous development pressure. Cost management is very important for improving the utilization rate of resources, the core competitiveness of an enterprise, and achieving the net profit target set by the enterprise. The basis study of cost management is the cost form. After the stickiness of costs is proposed, it has been widely concerned by academia and practice. Managers are the decision-makers of business activities and internal information disclosure. The current shareholding structure of the Chinese government’s macro-control has formed an “insider control” phenomenon, which highlights the importance of managers. Overconfidence of the managers can strongly impact on the manager’s decision-making. Based on this, it is of great significance to study the influence of managers’ overconfidence on the cost stickiness. This paper uses the data of Shanghai and Shenzhen A shares manufacturing companies from 2014 to 2018 to verify the existence of cost stickiness, and then studies the influence of managers’ overconfidence on the cost stickiness. The study found that there is a phenomenon of cost stickiness in listed companies in China’s manufacturing industry. More over, managers’ overconfidence can aggravate the problem of cost stickiness of enterprises. The innovation of the research is as following. Firstly, it enriches the research perspective of the sticky motivation of costs. Secondly, the study extends the research of managers’ overconfidence to the field of cost decision-making.
© The Authors, published by EDP Sciences, 2021
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