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Survey evidence on price-setting patterns of Romanian firms

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Author Info

  • Mihai Copaciu

    (National Bank of Romania, Monetary Policy and Modeling Department, Bucharest, Romania)

  • Florian Neagu

    (National Bank of Romania, Financial Stability Department, Bucharest, Romania)

  • Horia Braun-Erdei

    (ING Investment Management, Romania)

Abstract

This paper presents for Romanian firms the results of the first survey on price-setting patterns among the New Member States of the EU. Diverging from Inflation Persistence Network (IPN) findings, generally small firms perceive higher competitive pressure and adopt the market price, using a state-dependent rule, while lower perceived competition is consistent with medium and large firms using mark-up pricing. Prices are reviewed and changed more often than for EMU firms and are more flexible than wages. Similar to IPN evidence, contracts are the main sources of price stickiness. The survey suggests full price transmission of large unanticipated financial shocks. Copyright © 2009 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/mde.1484
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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Managerial and Decision Economics.

Volume (Year): 31 (2010)
Issue (Month): 2-3 ()
Pages: 235-247

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Handle: RePEc:wly:mgtdec:v:31:y:2010:i:2-3:p:235-247

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/7976

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  1. Coricelli, Fabrizio & Horváth, Roman, 2006. "Price Setting Behaviour: Micro Evidence on Slovakia," CEPR Discussion Papers 5445, C.E.P.R. Discussion Papers.
  2. Olivier Blanchard & Jordi Galí, 2005. "Real Wage Rigidities and the New Keynesian Model," Working Papers 243, Barcelona Graduate School of Economics.
  3. Laurence Ball & N. Gregory Mankiw, 1995. "A Sticky-Price Manifesto," NBER Working Papers 4677, National Bureau of Economic Research, Inc.
  4. Smets, Frank, 2003. "Maintaining price stability: how long is the medium term?," Journal of Monetary Economics, Elsevier, vol. 50(6), pages 1293-1309, September.
  5. Anil K. Kashyap, 1991. "Sticky prices: new evidence from retail catalogs," Working Paper Series, Macroeconomic Issues 91-26, Federal Reserve Bank of Chicago.
  6. Baumgartner, Josef & Scharler, Johann & Kwapil, Claudia, 2005. "The Price-Setting Behavior of Austrian Firms: Some Survey Evidence," Working Papers 100, Oesterreichische Nationalbank (Austrian Central Bank).
  7. Simon Hall & Mark Walsh & Anthony Yates, 1997. "How do UK companies set prices?," Bank of England working papers 67, Bank of England.
  8. Sheshinski, Eytan & Weiss, Yoram, 1977. "Inflation and Costs of Price Adjustment," Review of Economic Studies, Wiley Blackwell, vol. 44(2), pages 287-303, June.
  9. Levy, Daniel, et al, 1997. "The Magnitude of Menu Costs: Direct Evidence from Large U.S. Supermarket Chains," The Quarterly Journal of Economics, MIT Press, vol. 112(3), pages 791-825, August.
  10. John B. Taylor, 1998. "Staggered Price and Wage Setting in Macroeconomics," NBER Working Papers 6754, National Bureau of Economic Research, Inc.
  11. Mark Bils & Peter J. Klenow, 2002. "Some Evidence on the Importance of Sticky Prices," NBER Working Papers 9069, National Bureau of Economic Research, Inc.
  12. Apel, Mikael & Friberg, Richard & Hallsten, Kerstin, 2001. "Micro Foundations of Macroeconomic Price Adjustment: Survey Evidence from Swedish Firms," Working Paper Series 128, Sveriges Riksbank (Central Bank of Sweden).
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Cited by:
  1. Álvarez, Luis J., 2007. "What Do Micro Price Data Tell Us on the Validity of the New Keynesian Phillips Curve?," Economics Discussion Papers 2007-46, Kiel Institute for the World Economy.
  2. Ana Iregui & Ligia Melo & María Ramírez, 2012. "Wage Adjustment Practices and the Link between Price and Wages: Survey Evidence from Colombian Firms," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 76, pages 17-53.
  3. Thorvardur Tjörvi Ólafsson & Ásgerdur Pétursdóttir & Karen Á. Vignisdóttir, . "Price setting in turbulent times. Survey evidence from Icelandic firms," Economics Working Papers 2011-09, School of Economics and Management, University of Aarhus.
  4. Stahl, Harald, 2006. "Price adjustment in German manufacturing: evidence from two merged survey," Discussion Paper Series 1: Economic Studies 2006,46, Deutsche Bundesbank, Research Centre.
  5. Jacek Wallusch, 2012. "How frequently do consumer prices change in transition countries?," Applied Economics Letters, Taylor & Francis Journals, vol. 19(10), pages 921-928, July.
  6. Ana María Iregui & Ligia Alba Melo & María Teresa Ramírez, 2010. "Incrementos y rigideces de los salarios en Colombia: Un estudio a partir de una encuesta," REVISTA DE ECONOMÍA DEL ROSARIO, UNIVERSIDAD DEL ROSARIO.
  7. Klenow, Peter J. & Malin, Benjamin A., 2010. "Microeconomic Evidence on Price-Setting," Handbook of Monetary Economics, in: Benjamin M. Friedman & Michael Woodford (ed.), Handbook of Monetary Economics, edition 1, volume 3, chapter 6, pages 231-284 Elsevier.
  8. Ana María Iregui & Ligia Alba Melo & María Teresa Ramírez, 2009. "Formación e incrementos de salarios en Colombia: Un estudio microeconómico a partir de una encuesta a nivel de firma," BORRADORES DE ECONOMIA 006286, BANCO DE LA REPÚBLICA.

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