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- Title
Credit conditions and the cyclical behavior of inventories.
- Authors
Kashyap, Anil K.; Lamont, Owen A.
- Abstract
This paper examines micro data on U. S. manufacturing firms' inventory behavior during different macroeconomic episodes. Mitch of the analysis focuses on the 1951-1982 recession, which was apparently caused in large part by tight monetary policy. We find that the inventory investment of firms without access to public bond markets is significantly liquidity-constrained during this period. A similar pattern emerges during the 1974-1975 recession, in which tight money also appears to have played a role In contrast, such liquidity constraints are largely absent during periods of looser monetary policy in the 1970's and 1980's.
- Subjects
UNITED States; UNITED States manufacturing industries; BUSINESS cycles; MONETARY policy; RECESSIONS; MANUFACTURED products; MACROECONOMICS; INVENTORIES; INVESTMENTS
- Publication
Quarterly Journal of Economics, 1994, Vol 109, Issue 3, p565
- ISSN
0033-5533
- Publication type
Article
- DOI
10.2307/2118414