Evidence From Seven Countries on Whether Inventories Smooth Aggregate Output
NBER Working Paper No. 2664
Casual examination of annual postwar data on inventories and aggregate output for seven developed countries -- Canada, France, West Germany, Italy, Japan, United Kingdom, United States -- suggests that in these countries the primary function of aggregate inventories is not to smooth aggregate output in the face of aggregate demand shocks. Japan is a possible exception to this generalization.
Document Object Identifier (DOI): 10.3386/w2664
Published: Engineering Costs and Production Economics, 1989.