The Relationship Between Earnings Goals And Expenditures For Repairs And Maintenance

Abstract

This study examines whether American industry adjusts to the level expenditures for repairs and maintenance to meet earnings goals. We examine changes in repairs and maintenance expenditures when earnings vary from expectations and find evidence of a direct relation between these variables. This finding raises concerns since deviation from consistent repairs and maintenance programs solely to meet earnings goals may have a detrimental effect on the competitiveness of U.S. firms.