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Price setting before and during the pandemic: evidence from Swiss consumer prices

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  • Dr. Barbara Rudolf
  • Pascal Seiler

Abstract

We provide new evidence on price rigidity at the product level based on microdata underlying the Swiss consumer price index from 2008 to 2020. We find that the frequency of price changes has increased over the last decade, particularly among products where collection switched to online prices, reflecting the rise of e-commerce. Furthermore, price changes tend to be synchronized within rather than across stores. Time variations in inflation can be attributed mainly to variations in the frequency of both price increases and price decreases. In the first year of the pandemic, the frequency of price adjustments changed little on average, while temporary sales responded countercyclically to the respective demand conditions across sectors.

Suggested Citation

  • Dr. Barbara Rudolf & Pascal Seiler, 2022. "Price setting before and during the pandemic: evidence from Swiss consumer prices," Working Papers 2022-12, Swiss National Bank.
  • Handle: RePEc:snb:snbwpa:2022-12
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    File URL: https://www.snb.ch/en/publications/research/working-papers/2022/working_paper_2022_12
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    Cited by:

    1. Alex Oktay, 2022. "Heterogeneity in the exchange rate pass-through to consumer prices: the Swiss franc appreciation of 2015," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 158(1), pages 1-20, December.
    2. Chen, Haixia & Le, Vo Phuong Mai & Meenagh, David & Minford, Patrick, 2023. "UK Monetary Policy in An Estimated DSGE Model with State-Dependent Price and Wage Contracts," Cardiff Economics Working Papers E2023/22, Cardiff University, Cardiff Business School, Economics Section.

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    More about this item

    Keywords

    Price rigidity; price-setting behavior; consumer prices; inflation; COVID-19 pandemic;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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