Time-to-produce, inventory, and asset prices /

Bibliographic Details
Main Author: Chen, Zhanhui
Other Authors: Johnson, Shane A. (Thesis advisor), Gallmeyer, Michael F. (Thesis advisor)
Format: Thesis eBook
Language:English
Published: [College Station, Tex.] : [Texas A&M University], [2012]
Subjects:
Online Access:Link to OAK Trust copy

MARC

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100 1 |a Chen, Zhanhui. 
245 1 0 |a Time-to-produce, inventory, and asset prices /  |c by Zhanhui Chen. 
264 1 |a [College Station, Tex.] :  |b [Texas A&M University],  |c [2012] 
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500 |a "Major Subject: Finance" 
588 |a Description from author supplied metadata (automated record created 2012-10-22 13:24:58). 
502 |b Doctor of Philosophy  |c Texas A&M University  |d 2011  |o http://hdl.handle.net/1969.1/ETD-TAMU-2011-08-9724 
504 |a Includes bibliographical references. 
516 |a Text (Dissertation) 
520 3 |a In a production-based general equilibrium model, I study the impact of time-to-build and time-to-produce technology constraints and inventory on asset prices and macroeconomic quantity dynamics. A time-to-build constraint captures the delay in transforming new investment into productive capital; a time-to-produce constraint captures the delay in transforming productive capital into final products. Empirically, I find that the U.S. economy in aggregate exhibits approximately a three-quarter time-to-build and a four-quarter time-to-produce constraint. These delays in the production process introduce short-run risks in the economy where inventory accumulation facilitates consumption smoothing over time. Using this structure for time-to-build and time-to-produce constraints, I numerically calibrate a production-based general equilibrium model where the representative investor has recursive preferences over consumption and inventory. The model delivers first and second moments of macroeconomic quantities and asset prices consistent with the data. A small elasticity of intertemporal substitution is necessary to positively price the short-run risks induced by the production constraints. Inventories help fit the volatilities of asset returns, while the time-to-produce feature ensures nontrivial inventory holdings. In addition, the model is able to match empirical lead-lag patterns between asset prices and macroeconomic quantities as well as observed equity return predictability. 
500 |a Electronic resource. 
650 4 |a Major Finance. 
653 |a time-to-build 
653 |a inventory 
653 |a recursive preferences 
653 |a asset pricing 
653 |a time-to-produce 
700 1 |a Johnson, Shane A.,  |e thesis advisor. 
700 1 |a Gallmeyer, Michael F.,  |e thesis advisor. 
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