Price Setting in France: New Evidence from Survey Data

By C. Loupias, Roland Ricart. Social Science Research Network, 2004

149 citations recorded by the source corpus.

This paper reports the results of a survey conducted by the Banque de France during winter 2003-2004 to investigate the price-setting behavior of French manufacturing companies. Prices are found to adjust infrequently; the median firm modifies its price only once a year. Price reviews are more frequent than price changes; the median firm reviews its price quarterly. Firms are found to follow either time-dependent, state-dependent or both pricing rules. Moreover, the chosen interval of price reviews depends on the probability that changes in the firms' environment occur. Coordination failure and nominal contracts (either written or implicit) are the most important sources of price stickiness, while pricing thresholds and physical menu costs appear to be totally unimportant. Asymmetries in price stickiness are found to be different for cost shocks compared to demand shocks: prices are more rigid downward than upward for cost shocks, while the reverse is true for demand shocks.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/a51ff7084b3b114d68a891ee3247a6fc19a4fba3

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Citations in the corpus

The Pricing Behaviour of Firms in the Euro Area: New Survey Evidence (2005, unknown): “Electronic copy available at: http://ssrn.com/abstract=1703429 NOTES D’ÉTUDES ET DE RECHERCHE DIRECTION GÉNÉRALE DES ÉTUDES ET DES RELATIONS INTERNATIONALES”
The Price Setting Behaviour of Spanish Firms: Evidence from Survey Data (2005, background): “This result is consistent with the evidence for France, Luxembourg, Austria and Portugal reported in Loupias and Ricart (2004), Lünnemann and Mathä (2005), Kwapil et al. (2005) and Martins (2005), respectively.”
What Firms' Surveys Tell Us about Price-Setting Behavior in the Euro Area (2006, unknown): “19 Analogous results are obtained by Lünnemann and Mathä (2005) using price index data.”