Micro Price Dynamics during Japan's Lost Decades

Nao Sudo, Kozo Ueda and Kota Watanabe

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: We study micro price dynamics and their macroeconomic implications using daily scanner data from 1988 to 2013. We provide five facts. First, posted prices in Japan are ten times as flexible as those in the U.S. scanner data. Second, regular prices are almost as flexible as those in the U.S. and Euro area. Third, the heterogeneity of frequency and size of price change across products is sizable and maintained throughout the sample period. Fourth, during Japan's lost decades, temporary sales have played an increasingly important role in households' consumption expenditure. Fifth, the frequency of upward regular price revisions and the frequency of sales are significantly correlated with the macroeconomic environment in particular indicators associated with a labor market while other components of price changes are not.

Keywords: Lost decade; deflation; temporary sales; regular prices; scanner data; price stickiness (search for similar items in EconPapers)
JEL-codes: E3 E31 E5 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2013-09
New Economics Papers: this item is included in nep-hme and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Micro Price Dynamics during Japan's Lost Decades (2014)
Working Paper: Micro price dynamics during Japan's lost decades (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2013-63

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