How frequently do consumer prices change in transition countries?
Abstract
A common feature of recent literature regarding inflation dynamics is the Calvo pricing mechanism. Using this model and aggregate series, I estimate the price change probability and the mean time between price changes in 13 transition countries. The average price change probability is much larger than suggested by the New Keynesian Phillips Curve (NKPC) literature. The corresponding mean time between price changes is slightly longer than 6 months. Moreover, a forward-looking pricing has been found only for four countries.Download Info
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Bibliographic Info
Article provided by Taylor and Francis Journals in its journal Applied Economics Letters.
Volume (Year): 19 (2012)
Issue (Month): 10 (July)
Pages: 921-928
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