Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation

Denis Fougere (), Hervé LE BIHAN () and Patrick SEVESTRE

Documents de Travail from Banque de France

Abstract: This paper examines heterogeneity in price stickiness using a large, original, set of individual price data collected at the retail level for the computation of the French CPI. To that end, we estimate, at a very high level of disaggregation, competing-risks duration models that distinguish between price increases, price decreases and product replacements. The main .ndings are the following: i) cross-product and cross-outlet-type heterogeneity in both the shape of the hazard function and the impact of covariates is pervasive ii) at the product-outlet type level, the baseline hazard function of a price spell is non-decreasing iii) there is strong evidence of state-dependence, especially for price increases.

Keywords: Sticky prices; Heterogeneity; Hazard function; Duration models. (search for similar items in EconPapers)
JEL-codes: E31 C41 (search for similar items in EconPapers)
Date: 2005
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Related works:
Working Paper: Heterogeneity in consumer price stickiness - a microeconometric investigation (2005)
Working Paper: Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation (2006)
Working Paper: Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation (2005)
Journal Article: Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation (2007)
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Persistent link: http://EconPapers.repec.org/RePEc:bfr:banfra:137

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