A Reassessment of Flexible Price Evidence Using Scanner Data: Evidence from an Emerging Economy
AbstractIn this paper we use a new database of scanner-level prices for the Chilean economy to characterize the microeconomic behavior of prices during a period of high inflation. We are able to characterize the price-setting behavior by supermarket chain. The evidence indicates that there is significant heterogeneity in the pricing behavior of individual retailers. Analyzing the source of shocks, results show that even though chain-specific shocks account for a sizable fraction of the observed variation, common (i.e. countrywide) shocks to individual goods and product categories are the most important factors to explain the behavior of prices. In other words, the pricing strategy of retailers seems less important in developing countries to explain microeconomic price dynamics.
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Bibliographic InfoPaper provided by Central Bank of Chile in its series Working Papers Central Bank of Chile with number 641.
Date of creation: Aug 2011
Date of revision:
Other versions of this item:
- Gastón Chaumont & Miguel Fuentes & Felipe Labbé & Alberto Naudón, 2011. "A Reassesment of Flexible Price Evidence Using Scanner Data: Evidence from an Emerging Economy," Working Papers Central Bank of Chile 632, Central Bank of Chile.
- NEP-ALL-2011-09-05 (All new papers)
- NEP-CBA-2011-09-05 (Central Banking)
- NEP-COM-2011-09-05 (Industrial Competition)
- NEP-HME-2011-09-05 (Heterodox Microeconomics)
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