A Study of the Impacts of Leverage on Labor and Capital Productivity: A Case Study of Companies Listed in Tehran Stock Market

Management Science Letters, Vol. 3, pp. 973–984, 2013

12 Pages Posted: 18 Feb 2013

See all articles by Peyman Akbari

Peyman Akbari

Department of Management, Payame Noor University, I.R. of Iran; Department of Management, Payame Noor University, I.R of IRAN

Ehsan Mohammadi

Master Student of Accounting, Islamic Azad University, Hamedan Branch, Hamedan, Iran

Date Written: February 18, 2013

Abstract

Productivity is a primary objective of increasing competition in modern economy and any increase in productivity level helps development of organization in the competitive market. The purpose of this paper is to investigate the relationship between operating leverage, financial leverage, compound leverage as independent variables and productivity indices including labor and capital productivities as dependent variables. The study includes 102 companies accepted in Tehran Stock Market based on screening, systematic deletion, over the period 2005-2010. The required data are gathered through official financial statements, committee reports, and other available documents in Tehran Stock Market. Stepwise regression and Pearson correlation are used to analyze the data. The results of the study have indicated that there were significant relationships between independent variables including leverage ratios with labor productivity. In addition, there is also a significance relationship between leverage ratios with capital productivity of total assets.

Keywords: operating leverage, financial leverage, compound leverage, labor productivity, capital productivity

Suggested Citation

Akbari, Peyman and Akbari, Peyman and Mohammadi, Ehsan, A Study of the Impacts of Leverage on Labor and Capital Productivity: A Case Study of Companies Listed in Tehran Stock Market (February 18, 2013). Management Science Letters, Vol. 3, pp. 973–984, 2013, Available at SSRN: https://ssrn.com/abstract=2220138

Peyman Akbari (Contact Author)

Department of Management, Payame Noor University, I.R. of Iran ( email )

kermanshah
Iran

Department of Management, Payame Noor University, I.R of IRAN ( email )

kermanshah
Iran

Ehsan Mohammadi

Master Student of Accounting, Islamic Azad University, Hamedan Branch, Hamedan, Iran ( email )

Hamedan
Iran

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