Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123795
Authors: 
Carlsson, Mikael
Year of Publication: 
2014
Series/Report no.: 
Working Paper, Department of Economics, Uppsala University 2014:6
Abstract: 
We use micro data on product prices linked to information on the firms that set them to test for selection effects (state dependence) in micro-level producer pricing. In contrast to using synthetic data from a canonical menu-cost model, we find very weak, if any, micro-level selection effects when running price change probability regressions on actual data. Moreover, when fitting a model that nests both time- and state-dependent elements (the CalvoPlus model of Nakamura and Steinsson, 2010) to the data, the resulting parameters mimic the standard Calvo (1983) model. Thus, upstream in the supply chain, price-setting is best characterized as time-dependent.
Subjects: 
Price-setting
Business Cycles
Micro Data
JEL: 
D4
E3
L16
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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