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Asymmetric Price Adjustment - Evidence for India

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  • Sartaj Rather
  • M. Ramachandran

Abstract

The study tries to examine whether there exists asymmetry in the price adjustment of firms while using the commodity wise whole sale price indices belonging to three different sectors - primary, manufacturing and fuel-power and lubricants from India. Further, it also allows examining the thresholds values between which a particular firm chooses inaction and allows its relative price to deviate in either direction from the equilibrium level.

Suggested Citation

  • Sartaj Rather & M. Ramachandran, 2015. "Asymmetric Price Adjustment - Evidence for India," Working Papers id:6479, eSocialSciences.
  • Handle: RePEc:ess:wpaper:id:6479
    Note: Institutional Papers
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    References listed on IDEAS

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    More about this item

    Keywords

    Menu cost; asymmetric price adjustment; relative price; error correction; India; primary sector; manufacturing sector; price elasticity; firms; equilibrium; whole sale price index.;

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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