IDEAS home Printed from https://ideas.repec.org/a/bla/kyklos/v33y1980i4p585-614.html
   My bibliography  Save this article

Inventories In The Keynesian Macro Model

Author

Listed:
  • Alan S. Blinder

Abstract

An otherwise conventional Keynesian macro model is modified to include inventories of final goods by (1) drawing a distinction between production and final sales, and (2) allowing for a negative effect of the level of inventories on production. Two models are presented: one in which the labor market clears and one in which it does not. Both models are stable only if the negative effect of inventories on production is ‘large enough’. Both models also imply that real wages move procyclically ‐ in direct contrast to the usual implication of Keynesian models. Detailed analysis of the market‐clearing model shows that there should be negative correlation between the levels of inventories and output, and between changes in inventories and changes in output, over the business cycle. However, inventory change should be positively correlated with the level of output. Um Bestände an Endprodukten einzubeziehen, wird ein an sich konventionelles keynesianisches Modell modifiziert. Dazu wird (1) eine Trennung zwischen Produktion und Endnachfrage gezogen und (2) ein negativer Effekt aus der Hohe der Produktionsbestände berucksichtigt. Zwei Modelle werden vorgestellt : Im cinen wird der Arbeitsmarkt geräumt und im andern ist dies nicht der Fall. Beide Modelle sind nur dann stabil, wenn der Negativeffekt aus den Produktionsbeständen ≪hinlänglich gross≫ ist. Beide Modelle impIizieren auch, dass sich die Reallöhne prozyklisch bewegen ‐ in direktem Gegensatz zu den gewohnten Folgerungcn aus keynesianischen Modellen. Eine ausführliche Analyse des Markträumnungsmodelles zeigt, dass eine negative Korrelation zwischen Bestandes‐und Produktionsausstossniueau und zwischen Bestandes‐ und Ausstossänderungen im Verlaufe des Konjunkturzyklus zu finden sei. Indessen sollten Beständcsanderungen positiv mit den1 Produktionsniveau korreliert sein. L'auteur a modifié un modèle macro‐économique qui, par ailleurs, rcste fidèlement keynésien pour inclure les stocks de bien finals: (1) en établissant une distinction entre la production et les ventes finales; (2) en tenant comptc d'un effet négatif du niveau des stocks sur la production. I1 présente deux modèles: I'un dam lequel le marché du travail s'équilibre, I'autre dans lequel il lie s'équilibrc pas. Les deux modèles ne sont stables quc si l'effet négatif des stocks sur la production est ≪suffisamment important≫. Les deux modèles impliquent égalcment que les salaires réels évoluent procycliquemcnt, ce que n'impliquent pas habituellement les modèles keynésiens. L'analyse détaillée du modéle où le marché du travail s'équilibre miontre qu'il devrait y avoir une corrélation négative entre les niveaux de stocks et la production, et entre les modifications des stocks et les modifications de la production, 'au cours du cycle. Toutefois, il devrait exister tine corrélatian positive entre la modification des stocks et le niveau de la production.

Suggested Citation

  • Alan S. Blinder, 1980. "Inventories In The Keynesian Macro Model," Kyklos, Wiley Blackwell, vol. 33(4), pages 585-614, November.
  • Handle: RePEc:bla:kyklos:v:33:y:1980:i:4:p:585-614
    DOI: 10.1111/j.1467-6435.1980.tb00715.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-6435.1980.tb00715.x
    Download Restriction: no

    File URL: https://libkey.io/10.1111/j.1467-6435.1980.tb00715.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Blinder, Alan S & Maccini, Louis J, 1991. "The Resurgence of Inventory Research: What Have We Learned?," Journal of Economic Surveys, Wiley Blackwell, vol. 5(4), pages 291-328.
    2. Seidmann, Daniel J., 1985. "Target buffer stocks," European Economic Review, Elsevier, vol. 27(2), pages 165-182, March.
    3. Alan S. Blinder & Louis J. Maccini, 1991. "Taking Stock: A Critical Assessment of Recent Research on Inventories," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 73-96, Winter.
    4. Burim GASHI, 2014. "Fiscal Policy And Financial Crisis," Risk in Contemporary Economy, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, pages 262-270.
    5. Ogawa, Shogo, 2022. "Survey of non-Walrasian disequilibrium economic theory," MPRA Paper 115011, University Library of Munich, Germany.
    6. Franke, Reiner, 1996. "A Metzlerian model of inventory growth cycles," Structural Change and Economic Dynamics, Elsevier, vol. 7(2), pages 243-262, June.
    7. Jerry R. Green & Jean-Jacques Laffont, 1980. "Disequilibrium Dynamics with Inventories and Anticipatory Price-Setting:Some Impirical Results," NBER Working Papers 0453, National Bureau of Economic Research, Inc.
    8. Ogawa, Shogo, 2022. "Capital and inventory investments under quantity constraints: A microfounded Metzlerian model," MPRA Paper 111906, University Library of Munich, Germany.
    9. Ogawa, Shogo, 2024. "Perceived and expected quantity constraints in inventory dynamics," MPRA Paper 120629, University Library of Munich, Germany.
    10. Eckalbar, John C., 1985. "Inventories in a dynamic macro model with flexible prices," European Economic Review, Elsevier, vol. 27(2), pages 201-219, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:kyklos:v:33:y:1980:i:4:p:585-614. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0023-5962 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.