Do prices respond asymmetrically to cost changes?
AbstractThis article investigates price asymmetry by using an almost complete sample of Taiwanese industries to see whether output prices respond faster to cost increases than they do to decreases. In contrast with the earlier literature, the evidence shows that positive price asymmetry cannot be applied to all industries, especially those industries with rapid productivity growth. The evidence also indicates that firms exhibiting fast (slow) productivity growth see their prices react less (more) to cost increases than to cost decreases.
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Bibliographic InfoArticle provided by Taylor and Francis Journals in its journal Applied Economics.
Volume (Year): 42 (2010)
Issue (Month): 9 ()
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Web page: http://www.tandf.co.uk/journals/routledge/00036846.html
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