Wang, Pengfei; Wen, Yi; Xu, Zhiwei - In: Journal of Economic Dynamics and Control 44 (2014) C, pp. 196-217
We estimate a DSGE model with (S,s) inventory policies. We find that (i) taking inventories into account can significantly improve the empirical fit of DSGE models in matching the standard business-cycle moments (in addition to explaining inventory fluctuations); (ii) (S,s) inventory policies...