The influence of size on cost behaviour associated with tactical and operational flexibility
AbstractThis paper contributes with an empirical analysis, using a sample of farms, on the influence of size on cost behaviour under operational and tactical flexibility. Results indicate that small farms behave advantageously with respect to biggest farms in situations of operational and tactical flexibility. On the one hand, the increase in indirect costs with product diversification is higher in bigger farms than in smaller. On the other hand, while most farms are flexible enough to avoid cost stickiness, the biggest face considerable rigidities in downsizing indirect costs when activity decreases.
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Bibliographic InfoArticle provided by University of Chile, Department of Economics in its journal Estudios de Economia.
Volume (Year): 38 (2011)
Issue (Month): 2 Year 2011 (December)
Agricultural economics; Tactical flexibility; Operational flexibility; Cost behaviour; Size.;
Find related papers by JEL classification:
- M41 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - Accounting
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
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