Title: Capacity expansion decisions into asymmetric cost behaviour: reviews and search for new determinants

Authors: Karrar Abdulellah Azeez; Han DongPing; Marwah Abdulkareem Mahmood

Addresses: School of Management, Harbin Institute of Technology, Harbin, 150001, China; College of Economics and Administration, University of Kufa, Kufa, 54001, Iraq ' School of Management, Harbin Institute of Technology, Harbin, 150001, China ' School of Management, Harbin Institute of Technology, Harbin, 150001, China; College of Economics and Administration, University of Kufa, Kufa, 54001, Iraq

Abstract: Existing capacity factors are able to drive cost stickiness behaviour and can explain asymmetric random variables. The effect of capacity expansion decisions on cost response with respect to changes in capacity factors is still unclear. Capacity factors affecting asymmetric cost behaviour has been investigated by providing alternative view(s) which takes precedence of cost behaviour, resources adjustment cost and capacity problems into consideration. Cost stickiness is affected by capacity factors and this eventually leads to complex capacity problems and estimates of adjustment costs. Motivated by the limitations of existing asymmetric cost behaviour and capacity factors, this paper seeks to integrate sticky costs with operations/production literature that provides a comprehensive review of which capacity expansion factors drives asymmetric cost behaviour for internal and external users of accounting information. This paper adopts the capacity expansion decision as new approach including strengths, weaknesses and opportunities that identifies proxies in connection with asymmetric cost behaviour.

Keywords: asymmetric cost behaviour; capacity expansion decisions; cost stickiness; capacity factors.

DOI: 10.1504/IJSOI.2018.092585

International Journal of Services Operations and Informatics, 2018 Vol.9 No.2, pp.139 - 159

Received: 09 Jun 2017
Accepted: 12 Sep 2017
Published online: 25 Jun 2018 *

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