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A nonparametric panel data approach to the cyclical dynamics of price-cost margins

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  • Andrea Vaona

Abstract

By using nonparametric and panel data econometrics, this paper re-assesses the effect of both the current level of economic activity and of future expected demand on the dynamics of the price mark-up over marginal cost in US manufacturing industries from 1958 to 1996. Consistently with previous results, the current level of economic activity has a negative impact on the mark-up and expectations of future demand a positive one. Differences between consumer and producer goods and between more and less competitive sectors play a minor role. Differences between durable and nondurable goods, instead, find more empirical support

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1580.

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Length: 29 pages
Date of creation: Jan 2010
Date of revision:
Handle: RePEc:kie:kieliw:1580

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Keywords: mark-up; cyclical dynamics; durable goods; non-durable goods; nonparametric econometrics; panel data econometrics;

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