Input and Output Inventories
This paper presents a new stage-of-fabrication inventory model with ordering usage and stocking of input materials under gross production or value added technology The model extends the traditional linear-quadratic model of output (finished goods) inventories and yields joint decision rules for input and output inventories with extensive dynamic stage-of-fabrication linkages Data show that input inventories are more important than output inventories in business cycle fluctuations Maximum likelihood estimation is relatively successful for a structural inventory model in nondurable and durable good industries The results include evidence of convex costs input-inventory-saving technology and insensitivity to production technology specification
Year of publication: |
1997-09
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Authors: | Humphreys, Brad R ; Maccini, Louis J ; Schuh, Scott |
Institutions: | Department of Economics, Johns Hopkins University |
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