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dc.contributor.authorGoldberg, Pinelopi Koujianouen_US
dc.contributor.authorHellerstein, Rebeccaen_US
dc.date.accessioned2010-05-07en_US
dc.date.accessioned2012-08-17T14:37:44Z-
dc.date.available2012-08-17T14:37:44Z-
dc.date.issued2009en_US
dc.identifier.urihttp://hdl.handle.net/10419/60930-
dc.description.abstractConventional wisdom suggests that producer prices are more rigid than consumer prices and therefore play less of a role in the allocation of goods and services. Analyzing 1987-2008 microdata collected by the U.S. Bureau of Labor Statistics for the producer price index, we find that producer prices for finished goods and services in fact exhibit roughly the same rigidity as consumer prices that include sales and substantially less rigidity than consumer prices that exclude them. Moreover, large firms change prices two to three times more frequently than small firms do, and by smaller amounts, particularly in the case of price decreases. Longer price durations are associated with larger price changes, although there is considerable heterogeneity in this relationship. Long-term contracts are associated with somewhat greater price rigidity for goods and services, although the differences are not dramatic. The size of price decreases plays a key role in inflation dynamics, while the size of price increases does not. The frequencies of price increases and decreases tend to move together and so cancel one another out.en_US
dc.language.isoengen_US
dc.publisherFederal Reserve Bank of New York New York, NYen_US
dc.relation.ispartofseriesStaff Report, Federal Reserve Bank of New York 407en_US
dc.subject.jelE30en_US
dc.subject.jelE31en_US
dc.subject.jelE39en_US
dc.subject.ddc330en_US
dc.subject.keywordPrice rigidityen_US
dc.subject.keywordinflationen_US
dc.titleHow rigid are producer prices?en_US
dc.typeWorking Paperen_US
dc.identifier.ppn622794973en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Staff Reports, Federal Reserve Bank of New York

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