Menu Costs and Inflation Asymmetries Some Micro Data Evidence
The paper explains the observed asymmetric inflation response to value-added tax (VAT) changes in Hungary by calibrating a standard sectoral menu cost model on a new micro-level CPI data set. The model is able to reproduce important moments of the data, and finds that the asymmetry can be explained by the interaction of menu costs, (sectoral) trend inflation and forward-looking firms, thereby it provides direct evidence to the argument of Ball and Mankiw (1994).
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- Ball, L. & Mankiw, N.G., 1992.
"Asymmetric Price Adjustment and Economic Fluctuations,"
Harvard Institute of Economic Research Working Papers
1602, Harvard - Institute of Economic Research.
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"Real rigidities and nominal price changes,"
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RWP 06-03, Federal Reserve Bank of Kansas City.
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- Mark J. Zbaracki & Mark Ritson & Daniel Levy & Shantanu Dutta & Mark Bergen, 2004.
"Managerial and Customer Costs of Price Adjustment: Direct Evidence from Industrial Markets,"
The Review of Economics and Statistics,
MIT Press, vol. 86(2), pages 514-533, May.
- Mark Zbaracki & Mark Ritson & Daniel Levy & Shantanu Dutta & Mark Bergen, 2003. "Managerial and Customer Costs of Price Adjustment: Direct Evidence from Industrial Markets," Working Papers 2003-07, Bar-Ilan University, Department of Economics.
- Mark Zbaracki & Mark Ritson & Daniel Levy & Shantanu Dutta & Mark Bergen, 2004. "Managerial and Customer Costs of Price Adjustment: Direct Evidence from Industrial Markets," Macroeconomics 0402020, EconWPA.
- Mikhail Golosov & Robert E. Lucas Jr., 2007.
"Menu Costs and Phillips Curves,"
Journal of Political Economy,
University of Chicago Press, vol. 115, pages 171-199.
- Michael B. Devereux & Henry E. Siu, 2007.
"State Dependent Pricing And Business Cycle Asymmetries,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(1), pages 281-310, 02.
- Henry Siu & Michael B. Devereux, 2004. "State Dependent Pricing and Business Cycle Asymmetries," 2004 Meeting Papers 161, Society for Economic Dynamics.
- Miles S. Kimball & Michael Woodford, 1994.
"The quantitative analysis of the basic neomonetarist model,"
Federal Reserve Bank of Cleveland, pages 1241-1289.
- Kimball, Miles S, 1995. "The Quantitative Analytics of the Basic Neomonetarist Model," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 27(4), pages 1241-77, November.
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- Patrick J. Kehoe & Virgiliu Midrigan, 2007. "Sales and the real effects of monetary policy," Working Papers 652, Federal Reserve Bank of Minneapolis.
- Midrigan, Virgiliu, 2006. "Menu costs, multi-product firms, and aggregate fluctuations," CFS Working Paper Series 2007/13, Center for Financial Studies (CFS).
- repec:tpr:qjecon:v:107:y:1992:i:4:p:1261-82 is not listed on IDEAS
- Virgiliu Midrigan, 2005. "Menu Costs, Multi-Product Firms and Aggregate Fluctuations," Macroeconomics 0511004, EconWPA.
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