Adjustment costs

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Adjustment costs ( english costs adjustment ) are in the business administration that costs involved in the adaptation of employment to a changed market developments arise.


Adjustment costs are therefore caused by a change in the legal, technical or economic framework. If laws , technical progress or economic data changes force an operational adjustment, this results in costs for the company . It is therefore a question of costs that would not have been incurred if there had not been changes in the state of the environment . These adjustment costs are not a special cost type , but are included in individual cost types. It can, therefore, to fixed or variable costs , material costs , production costs , personnel costs , administrative costs , financing costs or sales costs act.

Business administration

In 1964, business economist Peter Swoboda understood adjustment costs to be those costs that begin with the recognition of a need for adjustment and reach their maximum when the adjustment measure is fully effective. According to Swoboda, elasticity costs or costs after the effectiveness of the adjustment measures were not included in the adjustment costs.

Adjustment costs can be attributed to institutional, economic or technological barriers. Institutionally are in the dismissal of workers job protection issues to be considered, so that the costs incurred during the retention personnel costs as adjustment costs are considered. This also applies to severance payments or social plan costs . Economic adjustment costs arise from fluctuation and overtime . Technological adjustment costs exist in the case of a limitational production function , because here the company can only change production according to the divisibility of the capital factor . For example, if a machine needs 3 workers to operate and one of them is to be dismissed, the machine can no longer be used.


Depending on the cause, a distinction can be made between internal and external adjustment costs. Internal adjustment costs arise within a company, such as costs of training or qualification measures . External adjustment costs are triggered , for example, by the company's relationship with the labor market , such as costs for job advertisements . For example , changes enforced by tax laws are also part of the external adjustment costs.


If these operational adjustment costs exceed a certain critical threshold, they also become economically relevant. The economic and social adjustment costs to changing conditions on the world markets are lower with flexible exchange rates than with fixed exchange rate parities . Exporters and importers have to reprint their price lists and renegotiate the burden sharing from exchange rate changes with their business partners ( price adjustment costs ). In addition, changes in exchange rates are market signals that, ceteris paribus, make a reallocation of resources in the economy necessary; this causes transaction costs . Industrial structural change is also associated with adjustment costs that entrepreneurs and workers in shrinking branches of industry have to bear. Adjustment costs are understood here as the costs of additional unemployment , social plans, information costs or transaction costs.

The investment theory , according to adjustment costs, both in the capital and in the divestment incurred. If demand increases in the medium term , companies start with expansion investments , which are to be understood as marginal costs of expansion and are part of the adjustment costs . Conversely, the costs of disinvestment (such as demolition costs ) are considered adjustment costs . Classical investment theory speaks of increasing adjustment costs per unit of capital when the investment amount is expanded. On the capital market caused adaptation costs in a non-perfectly elastic supply of capital , because a change in demand for capital on the price effect (eg. As rising lending rates ). Adjustment costs represent a significant extension of the basic model of neoclassical investment theory. The explicit consideration of adjustment costs of the capital stock in investment theory is first found in 1963.

Individual evidence

  1. Peter Swoboda, The operational adjustment as a problem of operational accounting , 1964, p. 59
  2. Wolfgang Franz, Arbeitsmarktökonomik , 2013, p. 146
  3. Hans-Hermann Francke / Walter Schepers, On the short-term relationship between demand and employment , 1985, p. 2
  4. Hanns W. Maull, Strategic Raw Materials: Risks for the Economic Security of the West , 1988, p. 20
  5. Alfred Kyrer / Walter Penker, Volkswirtschaftslehre: Grundzüge der Wirtschaftstheorie und -politik , 1996, p. 201
  6. Wolfgang Filc / Claus Köhler, Stabilization of the Currency System , 1985, p. 93
  7. OECD, Positive Adjustment Policies , 1983, p. 12
  8. Akira Takayama, Mathematical Ecoomics , 1985, pp. 697-712
  9. ^ Robert Eisner / Robert H Strotz, Determinants of Business Investment , in: DB Suits (Ed.), Impacts of Monetary Policy, 1963, pp. 60 ff.