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Gauging the performance of the linear-quadratic inventory model

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  • David Bivin

Abstract

The explanatory and predictive abilities of the infinite-horizon linear-quadratic inventory model are gauged using the flexible-accelerator model as a baseline. Tests of explanatory power for six nondurables industries indicate that the flexible accelerator has superior explanatory power for inventories and output in the majority of industries. Tests of predictive ability during the late 1990s also support the superiority of the flexible-accelerator model.

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  • David Bivin, 2005. "Gauging the performance of the linear-quadratic inventory model," Applied Economics, Taylor & Francis Journals, vol. 37(11), pages 1215-1231.
    • Handle: RePEc:taf:applec:v:37:y:2005:i:11:p:1215-1231
    DOI: 10.1080/00036840500118317
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    1. Martin Boileau & Marc-Andre Letendre, 2011. "Inventories, sticky prices, and the persistence of output and inflation," Applied Economics, Taylor & Francis Journals, vol. 43(10), pages 1161-1174.

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