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Consumer Price Behavior in Mexico Under Inflation Targeting: A Microdata Approach

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  • Carla Ysusi

Abstract

In this paper we do a statistical analysis of the Mexican Consumer Price Index microdata set to characterize the rigidities of the price setting process in the different sectors of the Mexican economy. The microdata set goes from July 2002 to December 2009. Broadly, results show that there exists a considerable heterogeneity in the price setting behavior across different sectors and over time. Evidence was found that when big shocks affect inflation, there is a strong co-movement of the fraction of the firms that change prices with the level of inflation.

Suggested Citation

  • Carla Ysusi, 2010. "Consumer Price Behavior in Mexico Under Inflation Targeting: A Microdata Approach," Working Papers 2010-09, Banco de México.
  • Handle: RePEc:bdm:wpaper:2010-09
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    More about this item

    Keywords

    Consumer Price Index; price setting process; frequencies and magnitudes of price changes.;
    All these keywords.

    JEL classification:

    • C19 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Other
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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