Price Adjustment in German Manufacturing: Evidence from Two Merged Survey
108 Pages Posted: 8 Jun 2016
Date Written: 2006
This paper presents new evidence on the formation of producer prices. The database combines a one-time survey that was conducted in June 2004 on a sample of 1,200 firms in manufacturing and time-series information on price adjustment of the same firms from a business-tendency survey. The share of time-dependent price setters amounts to 20 per cent. Neither Taylor nor Calvo type price setting describes their price adjustment well. Only a few firms are forward-looking, the majority relies on contemporaneous and past information.
Keywords: Price rigidity, sticky information, survey data
JEL Classification: E30, D40
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