Modelling manufacturing inventories

John Tsoukalas

Bank of England working papers from Bank of England

Abstract: This paper presents and applies a stage-of-fabrication inventory model to the UK manufacturing sector. The model emphasises the interaction between input (raw materials and work-in-process) and output (finished goods) inventories. This interaction is an important empirical regularity and proves critical for the ability of the model to fit the data. Decisions about input and output inventory investment cannot be considered in isolation from each other, but must be analysed jointly. Overall, the stage-of-fabrication model receives considerable support. Maximum likelihood estimation of the model's decision rules yields correctly signed and significant parameter estimates. In terms of producer behaviour, the results imply rising marginal costs of production and significant costs of adjusting production.

Date: 2005-12
New Economics Papers: this item is included in nep-bec
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.bankofengland.co.uk/research/Documents/workingpapers/2005/WP284.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.bankofengland.co.uk/research/Documents/workingpapers/2005/WP284.pdf [301 Moved Permanently]--> https://www.bankofengland.co.uk/research/Documents/workingpapers/2005/WP284.pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:boe:boeewp:284

Access Statistics for this paper

More papers in Bank of England working papers from Bank of England Bank of England, Threadneedle Street, London, EC2R 8AH. Contact information at EDIRC.
Bibliographic data for series maintained by Digital Media Team ().