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Conventional wisdom has it that inventory investment destabilizes the economy be-cause it is procyclical to sales. Khan … the existing (S,s) inventory literature that relies on the Krusell-Smith (1998) numerical solution methods, we … characterize (S,s) inventory policies in closed form despite the large state space in our general equilibrium model. Standard log …
Persistent link: https://www.econbiz.de/10009008699
This article deals with the issue of entry into an industry where firms share a collective reputation. First, we show that free entry is not socially optimal; there is a need for regulation through the imposition of a minimum quality standard. Second, we argue that a minimum quality standard can...
Persistent link: https://www.econbiz.de/10003659949
In this paper, we tackle the dilemma of pruning versus proliferation in a vertically differentiated oligopoly under the assumption that some firms collude and control both the range of variants for sale and their corresponding prices, likewise a multiproduct firm. We analyse whether pruning...
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This paper explores how social interactions among consumers shape markets. In a two-country model, consumers meet and exchange information about the quality of the goods. As information spreads, the demands evolve, affecting the prices and quantities manufactured by profit-maximizing firms. We...
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The purpose of this paper is to develop a model that integrates inventory and labor decisions. We extend a model of … inventory behavior to include a detailed specification of the role of labor input in the production process and of the costs … and the role of labor hoarding as an explanation of procyclical productivity and the persistence of inventory stocks …
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