Exploring the Asymmetric Cost Behavior in the Context of European Non-Listed Firms

This study provides international empirical evidence for the asymmetric cost behavior of the cost of goods sold and the operating expenses in the context of the European non-listed firms. We employ a data sample of 4,177,625 firm years observations from Amadeus Database for the period 2009-2017 to explore the asymmetric cost behavior phenomenon at the EU-28 countries pool and country level. Substantial variation in the direction of the asymmetric cost behavior, across countries and firm size clusters, is observed. However, in a considerable number of cases, the cost of goods sold and the operating expenses exhibit symmetric cost behavior. We conjecture that the reasons behind the observed pattern of asymmetric cost behavior in the organizational setting of non-listed firms are the relatively low availability of entrepreneurial economic resources and the presence of entrepreneurs which might affect the resource allocation decision-making process.