 When do firms adjust prices? Evidence from micro panel dataJournal of Monetary Economics, 2010, vol. 57, issue 6, 696-715 Abstract: The price-setting behavior of manufacturing firms is examined using a large panel of quarterly firm survey data from 1984 to 2007, which allows changes in firms' prices to be linked to several firm-specific variables. The results show that state-dependent pricing is clearly present in a low-inflation environment and that variables measuring the current situation of the firm, especially costs for intermediate products, are important determinants of price adjustments. Compared to purely time-dependent features, the state-dependent variables significantly add to the explanatory power of a price adjustment probability model. Macroeconomic factors are significant but contribute little in terms of the goodness of fit. Furthermore, when taking into account sticky plan models by excluding possibly predetermined price changes, the importance of state-dependent factors becomes even greater. Keywords: Price; setting; behavior; Time-dependent; pricing; State-dependent; pricing; Sticky; plans; Costs (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:moneco:v:57:y:2010:i:6:p:696-715 Access Statistics for this article Journal of Monetary Economics is currently edited by R. G. King and C. I. Plosser More articles in Journal of Monetary Economics from Elsevier |
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