Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/50442
Authors: 
Abrahamsen, Yngve
Hartwig, Jochen
Year of Publication: 
2011
Series/Report no.: 
KOF working papers // KOF Swiss Economic Institute, ETH Zurich 271
Abstract: 
The paper investigates the nexus between inventory investment and the change in aggregate production for 29 European countries over the period 2000-2009. A special interest is taken in the Great Recession of 2008/09. For most countries, a fairly uniform pattern emerges. Inventory investment is positively correlated with changes in production and follows the latter with a time-lag of two to three quarters. Therefore, there is no evidence that inventory investment either drives or smoothes the business cycle. Very few countries - Austria, Greece, Spain, and Switzerland - diverge from the typical pattern. This might hint to problems with respect to data quality.
Subjects: 
Inventory investment
production
business cycle
Great Recession in Europe
JEL: 
E22
E32
O52
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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