Increased interest expense and management’s expense preference behaviour of publicly-traded restaurant firms
Document Type
Article
Publication Date
4-2010
Publication Title
Journal of Services Research
Volume
10
Issue
1
First page number:
69
Last page number:
84
Abstract
The purpose of this research was to examine whether or not firms in a less-regulated industry with high competition exhibit expense preference behaviour, originally posited by Williamson (1963) with regards to interest expense. We used the restaurant industry to examine this issue because the restaurant industry is very sensitive to changes in market conditions due to its low profit margin. Interest expenses are exogenously determined and can have a serious impact on the profitability of the restaurant firms. The major finding of this paper shows that 'other expenses' increase along with interest expense. Managers do exhibit expense preference behaviour.
Disciplines
Business | Food and Beverage Management | Hospitality Administration and Management
Language
English
Permissions
Use Find in Your Library, contact the author, or use interlibrary loan to garner a copy of the article. Publisher copyright policy allows author to archive post-print (author’s final manuscript). When post-print is available or publisher policy changes, the article will be deposited
Repository Citation
Upneja, A.,
Dalbor, M. C.,
Hua, N.,
Repetti, T. A.
(2010).
Increased interest expense and management’s expense preference behaviour of publicly-traded restaurant firms.
Journal of Services Research, 10(1),
69-84.