Macroeconomic Implications of Uniform Pricing

Diego Daruich and Julian Kozlowski

No 2019-024, Working Papers from Federal Reserve Bank of St. Louis

Abstract: 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 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 multi-region chains do not. Using a quantitative regional model with multi-region 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.

Keywords: Uniform Pricing; Price Dispersion; Regional Economics (search for similar items in EconPapers)
JEL-codes: D40 E30 L10 R10 (search for similar items in EconPapers)
Pages: 75 pages
Date: 2019-09-18, Revised 2021-09-01
New Economics Papers: this item is included in nep-mac and nep-ure
Note: Publisher DOI: https://doi.org/10.1257/mac.20210172
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Published in American Economic Journal: Macroeconomics

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Journal Article: Macroeconomic Implications of Uniform Pricing (2023)
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DOI: 10.20955/wp.2019.024

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