Heterogeneity in consumer price stickiness - a microeconometric investigation

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

No 536, Working Paper Series from European Central Bank

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 findings 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)
New Economics Papers: this item is included in nep-mac and nep-mic
Date: 2005-10
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Related works:
Working Paper: Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation (2006)
Working Paper: Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation (2005)
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:ecb:ecbwps:20050536

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