Heterogeneity in Consumer Price Stickiness

By D. Fougère, Hervé le Bihan, P. Sevestre. Social Science Research Network, 2005

117 citations recorded by the source corpus.

We examine heterogeneity in price stickiness using a large, original, set of individual price data collected at the retail level for the computation of the French consumer price index. For that purpose, we estimate at a very high level of disaggregation, a piecewise-constant hazard model, as well as competing-risks duration models that distinguish between price increases, price decreases, and product replacements. The main findings are the following: (a) at the product–outlet-type level, the baseline hazard function of a price spell is nondecreasing; (b) cross-product and cross-outlet-type heterogeneity is pervasive, both in the shape and the level of the hazard function as well as in the impact of covariates; (c) there is strong evidence of state dependence, especially for price increases; (d) there is an asymmetry because determinants of price increases differ from those of price decreases.

Subfields: Economics and Econometrics, Marketing

View Paper: https://www.semanticscholar.org/paper/2a03fc3003ed52dbb504bc14297e8949081e398a

Citations in the corpus

• Sticky Prices in the Euro Area: A Summary of New Micro Evidence (2006, unknown): “…(2005a), Álvarez and Hernando (2004), Aucremanne and Dhyne (2004, 2005), Baudry et al. (2004), Baumgartner, et al. (2005), Dias et al. (2004, 2005), Fougère et al. (2005), Hoffmann and Kurz-Kim (2005), Jonker et al. (2004), Lünnemann and Mathä (2005a), Veronese et al. (2005),Vilmunen and Laakkonen…”
• Sticky Prices and Monetary Policy: Evidence from Disaggregated U.S. Data (2009, unknown): “[26] Fougere, Le Bihan, Servestre (2005), “Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation,” CEPR DP5300.”