EconPapers    
Economics at your fingertips  
 

How Frequently Do Consumer Prices Change in Austria? Evidence from Micro CPI Data

Josef Baumgartner (), Ernst Glatzer (), Fabio Rumler () and Alfred Stiglbauer ()
Additional contact information
Ernst Glatzer: Oesterreichische Nationalbank

Working Papers from Oesterreichische Nationalbank (Austrian Central Bank)

Abstract: In this paper a data set with price records collected for the computation of the Austrian CPI is used to estimate the average frequency of price changes and the duration of price spells to provide empirical evidence on the degree and characteristics of price rigidity in Austria. Depending on the estimation method applied, on average, prices are unchanged for 10 to 14 months. We find a strong heterogeneity across sectors and products. Price increases occur only slightly more often than price decreases. For both cases the typical size of the weighted average price change is quite large (11 and 15 percent, respectively). Like in related contributions we find that the aggregate hazard function is decreasing with time. Apart from heterogeneity across products and price setters, this is due to oversampling of products with a high frequency of price changes. Accounting for the unobserved heterogeneity in estimating the probability of a price change with a panel logit model (with fixed elementary product effects), we find a small but positive effect of the duration of a price spell on the probability of a price change. We also find that during the Euro cash changeover period the probability of price changes was higher.

Keywords: Consumer prices; sticky prices; frequency and synchronization of price changes; duration of price spells (search for similar items in EconPapers)
JEL-codes: C41 D21 E31 L11 (search for similar items in EconPapers)
Pages: 83
Date: 2005-07-25
New Economics Papers: this item is included in nep-dcm, nep-eec and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (76) Track citations by RSS feed

Downloads: (external link)
https://www.oenb.at/dam/jcr:41b739be-60d4-4200-b2a ... p101_tcm16-30801.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden (https://www.oenb.at/dam/jcr:41b739be-60d4-4200-b2a0-20c9d5e8911d/wp101_tcm16-30801.pdf [303 See Other]--> https://www.oenb.at/error_path/403.html?al_req_id=YzLWh7bQCq4FMv3Za1ppxwAAARQ)

Related works:
Working Paper: How frequently do consumer prices change in Austria? Evidence from micro CPI data (2005) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:onb:oenbwp:101

Ordering information: This working paper can be ordered from
Oesterreichische Nationalbank, Economic Studies Division, POB 61, A-1011 Vienna, Austria

The price is Free subject to availability.

Access Statistics for this paper

More papers in Working Papers from Oesterreichische Nationalbank (Austrian Central Bank) P.O. Box 61, A-1011 Vienna, Austria. Contact information at EDIRC.
Bibliographic data for series maintained by Markus Knell ().

 
Page updated 2022-09-28
Handle: RePEc:onb:oenbwp:101