【主题】Supply Chain Management and Aggregate Fluctuations
【摘要】Over the business cycle, firms adjust not only their input expenditures but also the number of suppliers from which they source. I incorporate this extensive margin into a real business cycle model. Using a dataset of supply chain relationships among US firms, I first document that increases in the number of suppliers are correlated with increases in intermediate input expenditures, total factor productivities, and costs of managing suppliers. Based on these facts, I develop a model in which firms trade off the productivity benefit (return to variety) of accessing more varieties with the (fixed) cost of managing these varieties. The extensive margin adjustment introduces a return to scale into production and amplifies productivity shocks: In my estimated model with multiple industries and a production network, the effect of industry productivity shocks on GDP fluctuations is one-fourth larger than in a (conventional) model where the extensive margin is absent.