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

  • Carla Ysusi
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    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.

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    File URL: http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/%7B8D7AEC68-86FE-E997-7EF9-BBB1560C002E%7D.pdf
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    Paper provided by Banco de México in its series Working Papers with number 2010-09.

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    Date of creation: Jun 2010
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    Handle: RePEc:bdm:wpaper:2010-09
    Contact details of provider: Web page: http://www.banxico.org.mx

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    8. Peter J. Klenow & Benjamin A. Malin, 2010. "Microeconomic Evidence on Price-Setting," NBER Working Papers 15826, National Bureau of Economic Research, Inc.
    9. Peter J. Klenow & Oleksiy Kryvtsov, 2005. "State-Dependent or Time-Dependent Pricing: Does It Matter for Recent U.S. Inflation?," Staff Working Papers 05-4, Bank of Canada.
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    12. Dhyne, Emmanuel & Álvarez, Luis J. & Le Bihan, Hervé & Veronese, Giovanni & Dias, Daniel & Hoffmann, Johannes & Jonker, Nicole & Lünnemann, Patrick & Rumler, Fabio & Vilmunen, Jouko, 2005. "Price setting in the euro area: some stylized facts from individual consumer price data," Working Paper Series 0524, European Central Bank.
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    20. repec:nbr:nberre:0126 is not listed on IDEAS
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