Firm Inventory Behavior in East Africa

Iimi, Atsushi ; Humphrey, Richard Martin ; Melibaeva, Sevara

World Bank, Washington, DC

关键词: TOTAL REVENUE;    VEHICLE OPERATING COSTS;    TRAFFIC CONGESTION;    EQUIPMENT;    NETWORK DATA;   

DOI  :  10.1596/1813-9450-7280
RP-ID  :  WPS7280

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Firms normally keep certain inventories,including raw materials, work-in-progress, and finishedgoods, to operate seamlessly and not to miss possiblebusiness opportunities. But inventory is costly, and theoptimal firm inventory differs depending on various economicconditions, including trade and transport costs. The paperexamines firm inventory behavior in East Africa, in whichtransport connectivity, especially to the ports, isconsidered as one of the major business constraints. Usingfirm-level data from Burundi, Kenya, Rwanda, Tanzania, andUganda, it is shown that transport connectivitysignificantly affects firm inventory behavior. Inparticular, road density and transport costs to the port areimportant to determine the optimal inventory level. Withmore roads in a city and/or cheaper access to the port,firms would hold smaller inventories.