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Retail Price Setting in Uruguay

Author

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  • Fernando Borraz

    ()

  • Leandro Zipitría

Abstract

We analyze the behaviour of prices in Uruguay using a unique database of 30 millions daily prices. We find that prices change about 5 times a year with no seasonal patter. Prices changes are highly synchronised and concentrated on the first day of the month. Our paper is the first to present evidence of high synchronization of prices, which in turn could be explained mainly by the data periodicity. Overall the analysis seems to be consistent with state-dependent pricing models, although we found some interesting features of prices that could not be explained by these models.

Suggested Citation

  • Fernando Borraz & Leandro Zipitría, 2012. "Retail Price Setting in Uruguay," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, vol. 0(Spring 20), pages 77-109, January.
  • Handle: RePEc:col:000425:009967
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    References listed on IDEAS

    as
    1. 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.
    2. Fisher, Timothy C. G. & Konieczny, Jerzy D., 2000. "Synchronization of price changes by multiproduct firms: evidence from Canadian newspaper prices," Economics Letters, Elsevier, vol. 68(3), pages 271-277, September.
    3. Alberto Cavallo, 2015. "Scraped Data and Sticky Prices," NBER Working Papers 21490, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Fernando Borraz & Alberto Cavallo & Roberto Rigobon & Leandro Zipitria, 2016. "Distance and Political Boundaries: Estimating Border Effects under Inequality Constraints," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 21(1), pages 3-35, January.
    2. Emilio Aguirre & Pablo Blanchard & Fernando Borraz & Joaquín Saldain, 2015. "Prices and Competition. Evidence from a Social Program," Documentos de trabajo 2015002, Banco Central del Uruguay.
    3. Borraz, Fernando & Zipitría, Leandro, 2017. "Law of One Price, Distance, and Borders," GLO Discussion Paper Series 87, Global Labor Organization (GLO).
    4. Rius, Andrés & Zipitría, Leandro, 2016. "Formación y determinación de precios en el Uruguay," Estudios y Perspectivas – Oficina de la CEPAL en Montevideo 22, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    5. Fernando Borraz & Gerardo Licandro & Daniela Sola, 2013. "Wage and Price Setting. New Evidence from Uruguayan Firms," Documentos de trabajo 2013008, Banco Central del Uruguay.
    6. Kochen Federico, 2016. "Price-Setting in Mexico and the Real Effects of Monetary Shocks," Working Papers 2016-21, Banco de México.

    More about this item

    Keywords

    Uruguay; behaviour; prices; seasonal pattern; synchronization; periodicity;

    JEL classification:

    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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