Price Setting Practices in Greece: Evidence from a Small-Scale Firm-Level Survey

48 Pages Posted: 11 Aug 2022

See all articles by Daphne Nicolitsas

Daphne Nicolitsas

University of Crete - Department of Economics

Date Written: April 1, 2013

Abstract

The paper documents the price setting practices followed by some 400 or so firms operating in Greece. Survey replies reveal: a low percentage of firms changing prices with frequency higher than annual; staggering of price changes during the year; sluggish adjustment of prices to cost shocks; asymmetries in price adjustment across positive and negative cost shocks and a speedier adjustment to increases in costs than to reductions in demand. The data confirm cross-sectional variations in price setting practices also found for other countries. On the basis of the results reached the conjecture that the prevalence of small firms, of firms providing services to businesses and of firms active in tourismrelated activities might lie behind the inflation persistence exhibited until recently in Greece appears plausible.

Keywords: price setting; competition; survey data

JEL Classification: E31, C41, J31, J41

Suggested Citation

Nicolitsas, Daphne, Price Setting Practices in Greece: Evidence from a Small-Scale Firm-Level Survey (April 1, 2013). Bank of Greece Working Paper No. 156, Available at SSRN: https://ssrn.com/abstract=4182434 or http://dx.doi.org/10.2139/ssrn.4182434

Daphne Nicolitsas (Contact Author)

University of Crete - Department of Economics ( email )

Rethymno, GR-74100
Greece

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