Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/230424 
Year of Publication: 
2018
Series/Report no.: 
Cardiff Economics Working Papers No. E2018/18
Publisher: 
Cardiff University, Cardiff Business School, Cardiff
Abstract: 
This paper systematically integrates microdata and macrodata analysis of price rigidity in mon-etary economics. We explore the mechanism of price-setting using survival based approaches in order to see what factors drive the observed price rigidity. We find significant effects of macroeconomic variables such as inflation and output, which should be purged off before cal-ibrating any macroeconomic models. The microdata findings are then used to estimate and simulate a heterogeneous price-setting model with a generalised Calvo goods sector and a gen-eralised Taylor service sector, which improves the performance in matching macrodata persistence.
Subjects: 
Price Rigidity
Price Setting Behaviour
Microdata
Survival Analysis
Heterogeneous Agent Model
Persistence Puzzle
JEL: 
C41
D21
E31
E32
Document Type: 
Working Paper

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