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The cyclical behaviour of inventories: European cross-country evidence from the early 1990s recession

  • Fabio Bagliano
  • Alessandro Sembenelli

This paper employs data for a panel of firms from France, Italy and the UK to study the effect of the recession of the early 1990s on inventory investment, controlling for cyclical fluctuations at the firm level. The results clearly show some common patterns across countries, pointing to the relevance of financial factors (namely, the level of leverage) in propagating initial recessionary shocks. Moreover, Italian firms, especially if 'small and young', seem more likely to suffer from a reduction in the value of collateralizable assets possibly originated by restrictive policy actions.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/0003684042000295601
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Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 36 (2004)
Issue (Month): 18 ()
Pages: 2031-2044

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Handle: RePEc:taf:applec:v:36:y:2004:i:18:p:2031-2044
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  17. Stephen D. Oliner & Glenn D. Rudebusch, 1995. "Is there a bank lending channel for monetary policy?," Economic Review, Federal Reserve Bank of San Francisco, pages 1-20.
  18. Joe Peek & Eric S. Rosengren, 1995. "Is bank lending important for the transmission of monetary policy: an overview," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 39, pages 1-14.
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