Macroeconomic Implications of Uniform Pricing
Diego Daruich and
American Economic Journal: Macroeconomics, 2023, vol. 15, issue 3, 64-108
We compile a new database of grocery prices in Argentina. We find uniform pricing both within and across regions—i.e., prices almost do not vary within the stores of a chain. In line with uniform pricing, prices in stores of chains operating in one region react to changes in regional employment while prices in multiregion chains do not. Using a quantitative regional model with multiregion firms and uniform pricing, we find a one-half smaller elasticity of prices to a regional than an aggregate shock. This result highlights that some caution may be necessary when using regional shocks to estimate aggregate elasticities.
JEL-codes: D22 L11 L81 O14 O18 R32 (search for similar items in EconPapers)
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Working Paper: Macroeconomic Implications of Uniform Pricing (2021)
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