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Abstract

We introduce a new data set on over 230,000 monthly prices for 10 goods in 50 Canadian cities over the 40 year period from 1910 to 1950. This coupled with previously published price information from the late twentieth century allows us to present one of the first comprehensive views of nominal rigidities and retail price dispersion over the past 100 years. We find that nominal rigidities have been conditioned upon prevailing rates of inflation with a greater frequency of price changes occurring in the 1920s and the 1970s. Additionally, the process of retail market integration has surprisingly followed a U-shaped trajectory, with many domestic markets being better integrated—as measured by the average dispersion of retail prices—at mid-century than in the 1990s. We also consider the linkages between nominal rigidities and price dispersion, finding results consistent with present-day data.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 16098.

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Date of creation: Jun 2010
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Handle: RePEc:nbr:nberwo:16098

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Find related papers by JEL classification:

• E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
• L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
• N82 - Economic History - - Micro-Business History - - - U.S.; Canada: 1913-

This paper has been announced in the following NEP Reports:

• NEP-ALL-2010-06-26 (All new papers)
• NEP-CBA-2010-06-26 (Central Banking)
• NEP-HIS-2010-06-26 (Business, Economic & Financial History)
• NEP-MAC-2010-06-26 (Macroeconomics)
• NEP-MON-2010-06-26 (Monetary Economics)

References

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Cited by:

1. Mario J. Crucini & Mototsugu Shintani & Takayuki Tsuruga, 2012. "Noisy Information, Distance and Law of One Price Dynamics Across US Cities," NBER Working Papers 17815, National Bureau of Economic Research, Inc.

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