The patterns and determinants of price setting in the Belgian industry

David Cornille () and Maarten Dossche
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David Cornille: National Bank of Belgium, Research Department

No 82, Working Paper Research from National Bank of Belgium

Abstract: This paper documents the patterns and determinants of price setting in the Belgian industry. We analyse the micro data underlying the Producer Price Index (PPI) over the period from February 2001 to January 2005. On average only one out of four prices changes in a typical month, whereas the absolute size of a price change amounts to 6 p.c. The frequencies of price adjustment are particularly heterogeneous across sectors, which is determined by heterogeneity in the market and cost structure. We find no signs of downward nominal rigidity. A joint analysis of sizes and frequencies of price adjustment across time shows that price setting is characterised by both time and state-dependent pricing. About 38 p.c. of the exported goods are affected by pricing-to-market.

Keywords: producer price setting; nominal price rigidity; pricing-to-market; time-dependent pricing; state-dependent pricing; staggering (search for similar items in EconPapers)
JEL-codes: D40 E31 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2006-05
New Economics Papers: this item is included in nep-com, nep-eec and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Related works:
Working Paper: The patterns and determinants of price setting in the Belgian industry (2006)
Working Paper: The Patterns and Determinants of Price Setting in the Belgian Industry (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:nbb:reswpp:200605-1

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