Evidence on Price Stickiness in Japan

Kozo Ueda

No CARF-F-570, CARF F-Series from Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo

Abstract: Using microdata from the Retail Price Survey (the basic statistics for the Consumer Price Index), we document facts regarding price stickiness in Japan. The main results are as follows: (1) The average frequency of price changes approximates 20% on a monthly basis. (2) The frequency of price changes is more heterogenous than that in the U.S. (3) Whereas no clear relationship exists between the frequency and size of price changes, a positive correlation emerges between the size of price changes and price dispersion across stores. (4) Large cities tend to have a higher frequency of price changes and smaller price dispersion than small cities. (5) A positive relationship exists between price changes and jobs-to-applicants ratio for some services, whereas a negative relationship exists between the frequency of price changes and jobs-to-applicants ratio for some goods. (6) Behind the 2022-23 price increase, the frequency of price changes exhibits a notable increase for certain goods and services such as eating out, while no distinct change is observed for the size of price changes or price dispersion.

Pages: 39
Date: 2023-09
New Economics Papers: this item is included in nep-ger and nep-mon
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