Consumer Price Setting in Italy

Silvia Fabiani (), Angela Gattulli (), Roberto Sabbatini () and Giovanni Veronese ()
Additional contact information
Silvia Fabiani: Bank of Italy
Angela Gattulli: Bank of Italy
Roberto Sabbatini: Bank of Italy
Giovanni Veronese: Bank of Italy

Giornale degli Economisti, 2006, vol. 65, issue 1, pages 31-74

Abstract: This paper investigates the microeconomic behaviour of consumer prices in Italy using the individual price records collected by Istat. We discuss how to analyse price stickiness and we compute a quantitative measure of the unconditional degree of price rigidity. Prices are found to be rather sticky, remaining unchanged on average for around 10 months; price spells last longer for non-energy industrial goods and services, much less for energy products. Prices are revised more frequently upwards than downwards, while the size of price changes is quite symmetric. Price stickiness is less marked in large modern stores than in traditional shops. Price changes are quite synchronized, in particular in the services sector.

Keywords: consumer prices; nominal rigidity; frequency of price change (search for similar items in EconPapers)
JEL-codes: D21 D40 E31 (search for similar items in EconPapers)
Date: 2006
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