IDEAS home Printed from https://ideas.repec.org/a/pal/imfstp/v54y2007i4p701-726.html
   My bibliography  Save this article

Price Variability Under Price Level Stability—A Study of Sierra Leone's Price Dynamics Using Micro-Level Price Data

Author

Listed:
  • Arto Kovanen

Abstract

This paper offers a unique insight into price dynamics and pricing behavior in Sierra Leone. It examines micro-level price data during a period when the price level remained constant while relative prices displayed considerable volatility. We find that the key factors to explain differences in the average frequency of price changes are inflation volatility and product diversification. Inflation inertia is not significant empirically, except during an earlier period. We show that the variability of relative prices is largely due to a few items that are weighted heavily in the consumer price index. The empirical evidence further suggests that producers in Sierra Leone are more likely to adjust their prices in response to events rather than at fixed intervals. Inflation volatility has also weakened monetary policy effectiveness in Sierra Leone, which could be remedied by introducing a core inflation measure that would exclude volatile product prices. IMF Staff Papers (2007) 54, 701–726. doi:10.1057/palgrave.imfsp.9450021

Suggested Citation

  • Arto Kovanen, 2007. "Price Variability Under Price Level Stability—A Study of Sierra Leone's Price Dynamics Using Micro-Level Price Data," IMF Staff Papers, Palgrave Macmillan, vol. 54(4), pages 701-726, November.
    • Handle: RePEc:pal:imfstp:v:54:y:2007:i:4:p:701-726
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/imfsp/journal/v54/n4/pdf/9450021a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: http://www.palgrave-journals.com/imfsp/journal/v54/n4/full/9450021a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:imfstp:v:54:y:2007:i:4:p:701-726. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.