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Understanding Firm Dynamics with Daily Data

Lukas Hack () and Davud Rostam-Afschar

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: How do firms respond to macroeconomic shocks? To study this question, we construct novel daily time series that measure firms’ plans and expectations based on surveys from Germany. Daily variation allows us to estimate the short-run aggregate responses of firms in short samples. This allows us to analyze the post-pandemic inflation surge without relying on pre-pandemic data. We find that firms’ plans, notably price-setting plans, respond within days to oil supply and monetary policy shocks but not to forward guidance shocks. The effects are especially strong for small and non-tradeable sector firms. Finally, expectations respond strongly and swiftly, but only to monetary policy.

Keywords: Daily data; firms; monetary policy; oil supply; inflation surge (search for similar items in EconPapers)
JEL-codes: C83 E31 E43 E52 E58 (search for similar items in EconPapers)
Pages: 74
Date: 2024-09
New Economics Papers: this item is included in nep-cba, nep-eur and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2024_593

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