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Price setting in Hungary-a store-level analysis

Author

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  • Péter Gábriel

    (Department of Economics, Magyar Nemzeti Bank, Budapest, Hungary)

  • Ádám Reiff

    (Department of Economics, Magyar Nemzeti Bank, Budapest, Hungary)

Abstract

This paper uses Hungarian micro-CPI data between December 2001 and June 2007 to provide descriptive statistics of store-level pricing practices in Hungary. First we present simple descriptive statistics about the frequency and average size of price changes, and compare it with similar statistics from other countries. Then we decompose the observed variations in the inflation rate to variations in frequencies and sizes. Finally, we estimate the inflation effects of three general VAT-rate changes during our sample period. Copyright © 2009 John Wiley & Sons, Ltd.

Suggested Citation

  • Péter Gábriel & Ádám Reiff, 2010. "Price setting in Hungary-a store-level analysis," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 31(2-3), pages 161-176.
  • Handle: RePEc:wly:mgtdec:v:31:y:2010:i:2-3:p:161-176 DOI: 10.1002/mde.1479
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    References listed on IDEAS

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    7. Etienne Gagnon, 2009. "Price Setting during Low and High Inflation: Evidence from Mexico," The Quarterly Journal of Economics, Oxford University Press, vol. 124(3), pages 1221-1263.
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    Cited by:

    1. Adam Reiff & Attila Ratfai, 2009. "The Geography of Consumer Prices," 2009 Meeting Papers 607, Society for Economic Dynamics.
    2. Konstantins Benkovskis & Ludmila Fadejeva, 2014. "The effect of VAT rate on inflation in Latvia: evidence from CPI microdata," Applied Economics, Taylor & Francis Journals, vol. 46(21), pages 2520-2533, July.
    3. 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.
    4. Zsombor Cseres-Gergely & Gyorgy Molnar & Tibor Szabo, 2017. "Expenditure responses, policy interventions and heterogeneous welfare effects in Hungary during the 2000s," IEHAS Discussion Papers 1704, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
    5. Bart Hobijn & Fernanda Nechio, 2015. "Sticker Shocks: VAT changes and the substitution across expenditure categories," 2015 Meeting Papers 697, Society for Economic Dynamics.
    6. Hobijn, Bart & Nechio, Fernanda, 2015. "Sticker shocks: using VAT changes to estimate upper-level elasticities of substitution," Working Paper Series 2015-17, Federal Reserve Bank of San Francisco, revised Oct 2017.
    7. Alvarez González, Luis Julián, 2008. "What Do Micro Price Data Tell Us on the Validity of the New Keynesian Phillips Curve?," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 2, pages 1-36.
    8. Adam Reiff & Peter Karadi, 2014. "Menu Costs, Aggregate Fluctuations and Large Shocks," 2014 Meeting Papers 914, Society for Economic Dynamics.
    9. M. Utku Ozmen & Orhun Sevinc, 2011. "Price Rigidity In Turkey : Evidence From Micro Data," Working Papers 1125, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    10. Dixon, Huw & Franklin, Jeremy & Millard, Stephen, 2014. "Sectoral shocks and monetary policy in the United Kingdom," Bank of England working papers 499, Bank of England.
    11. Shruti Tripathi & Ashima Goyal, 2011. "Relative prices, the price level and inflation: Effects of asymmetric and sticky adjustment," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2011-026, Indira Gandhi Institute of Development Research, Mumbai, India.
    12. 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.

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