Inventories and Backlogs:  An Analysis of The Business Cycle
{'Code': '04050100', 'Directorate': {'Abbreviation': 'SBE', 'LongName': 'Direct For Social, Behav & Economic Scie'}, 'Division': {'Abbreviation': 'SES', 'LongName': 'Divn Of Social and Economic Sciences'}}
{'SignBlockName': 'Robin A. Cantor', 'PO_EMAI': None, 'PO_PHON': None}
This project concerns an important and interesting topic, namely the            determinants of production inventories and backlogs.  For many years            there has been in economic research the realization that inventories            play a central role in changes in the business cycle.  Even though the          level of quarterly inventory investment is, typically, less than one            percent of GNP, changes in inventory investment often are important at          cyclical turning points.  In fact, empirical evidence shows that                changes in inventory investment account for nearly one half the total           change in business activity for most of the eight post- World War II            recessions in the U.S.  Data is limited for the pre-World War II era,           but indications are that the same relationship holds.  Thus analyzing           changes in inventories might be a good method to predict wide shifts            in business activity.                                                                                                                                           In spite of the obvious importance of knowing why firms accumulate              inventories, there is little unambiguous evidence as to whether firms           are avoiding unforeseen fluctuations in production costs or in sales of         final products when they increase inventories.  In addition, firms can          accomplish the same goals by accumulating backlogs of orders.  Thus             the models most often used to study inventory accumulation, namely the          production smoothing models, are inherently flawed.  This project               studies production inventories from the standpoint of firms' avoiding           the costs of backlog orders.  These costs can in general be greater             than those of simply holding inventories, since having unfilled                 backlog orders incurs bad customer relations.                                                                                                                   Technically, Professor West estimates structural models to test                 whether backlog costs are numerically and statistically significant.            A production lag is assumed, and a within period backlog occurs if              orders exceed production at the beginning of each production period.            He also does stochastic numerical simulations of the nonlinear model,           to explain the observed facts about inventories, in particular whether          the model predicts that negative demand shocks, that is recessions,             induce inventory liquidations of the sort observed in the post-World            War II period.
{'FirstName': 'Kenneth', 'LastName': 'West', 'PI_MID_INIT': 'D', 'PI_SUFX_NAME': None, 'PI_FULL_NAME': 'Kenneth D West', 'EmailAddress': 'kdwest@wisc.edu', 'NSF_ID': '000317557', 'StartDate': '07/01/1987', 'EndDate': None, 'RoleCode': 'Principal Investigator'}
{'Name': 'Princeton University', 'CityName': 'PRINCETON', 'ZipCode': '085442001', 'PhoneNumber': '6092583090', 'StreetAddress': '1 NASSAU HALL', 'StreetAddress2': None, 'CountryName': 'United States', 'StateName': 'New Jersey', 'StateCode': 'NJ', 'CONGRESSDISTRICT': '12', 'CONGRESS_DISTRICT_ORG': 'NJ12', 'ORG_UEI_NUM': 'NJ1YPQXQG7U5', 'ORG_LGL_BUS_NAME': 'THE TRUSTEES OF PRINCETON UNIVERSITY', 'ORG_PRNT_UEI_NUM': None}
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{'Code': '1320', 'Text': 'Economics'}
{'url': 'https://www.nsf.gov/awardsearch/download?DownloadFileName=1987&All=true', 'xml': '8709442.xml'}