Price stickiness and markup variations in market games

Retail Price Stickiness, Market Structure and Distribution Channels

Using Japanese scanner data of transaction prices and sales for more than 1,600 commodity groups from 1988 to 2008, we find a statistically significant negative correlation between the frequency of price changes and the degree of market concentration. We also find that structural factors of a distribution channel are significantly correlated with rigidity in retail prices. Decomposing the frequ...

Aggregate Price Stickiness

We accomplish two tasks to characterize aggregate price stickiness in this paper. First, we endogenize β, the fraction of the firms keeping their price unchanged following a money supply shock in the near-rationality model (Akerlof and Yellen, 1985) by introducing a distribution of price-adjustment barriers among the firms into the near-rationality model. Second, as β can be considered an indic...

Market Structure and Price Adjustment in the Iranian Tea Market

Price Stickiness in Ss Models: Basic Properties

What is the relation between infrequent price adjustment and the dynamic response of the aggregate price level to monetary shocks? Caplin and Spulber (1987) provide a stark example where the answer is “none.” It is well known that by relaxing their limit assumptions some price stickiness is regained but, to our knowledge, there are no general results on this issue. In this paper we study the re...

Wage Stickiness and Nonclearing Labor Market in Business Cycles ∗

This paper presents a dynamic optimization model of RBC type augmented by wage stickiness, and nonclearing labor market. Agents are required to adaptively optimize when facing constraints on the markets. Calibration for the U. S. economy shows that the model will produce higher volatility in employment. Moreover, it provides more reasonable cross-correlation of employment and wages with other m...