This paper investigates the impact of financial constraints on firms' inventory holdings, an area of significant interest given that inventories are volatile over the business cycle. I use detailed data on Swedish firms' balance sheets, income statements, and credit scores. I employ a regression...

Inventory leanness requires that firms minimize inventory mistreatment and misuse. A firm performance deteriorates because of high inventory misuse, and because of such an issue, the effect on the firm's credit rating can also be seen. This study examines the effect of inventory leanness on...