Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/152970
Authors: 
Fougère, Denis
Le Bihan, Hervé
Sevestre, Patrick
Year of Publication: 
2005
Series/Report no.: 
ECB Working Paper No. 536
Abstract: 
This paper examines heterogeneity in price stickiness using a large, original, set of individual price data collected at the retail level for the computation of the French CPI. To that end, we estimate, at a very high level of disaggregation, competing-risks duration models that distinguish between price increases, price decreases and product replacements. The main findings are the following: i ) cross-product and cross-outlet-type heterogeneity in both the shape of the hazard function and the impact of covariates is pervasive ii) at the product-outlet type level, the baseline hazard function of a price spell is non-decreasing iii ) there is strong evidence of state dependence, especially for price increases.
Subjects: 
duration models
hazard function
heterogeneity
sticky prices
JEL: 
E31
C41
Document Type: 
Working Paper

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