Recent Evidence on Improved Inventory Control: A quarterly Model of the US Economy for the period 1959-2001

Osama Sweidan ()

International Journal of Applied Econometrics and Quantitative Studies, 2004, vol. 1, issue 4, 75-84

Abstract: This Paper aimed to re-test the hypothesis whether the improved inventory control affects the inventory investment or not. This paper used Bechter and Stanley (1992) model. The contribution of this letter has two dimensions; first, this paper extends the time horizon by using a quarterly data of the U.S. economy for the period 1959-2001. Also, it modifies Bechter and Stanley model under certain assumption and use the adjusted model to re-exam the hypothesis. The results of the paper support the idea that improved inventory control has a significant impact on the behavior of inventory investment. In addition, it shows that the improvement vary from one sector to another. Further, the paper showed that the speed of adjustment will be faster if the firms ignore holding inventories as a buffer stock.

Keywords: inventory control; model; economy; USA (search for similar items in EconPapers)
JEL-codes: C51 O51 (search for similar items in EconPapers)
Date: 2004
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