Price Setting in France: New Evidence from Survey Data

Abstract

discussions on a previous version of this paper, and more The Eurosystem Inflation Persistence NetworkThis paper reflects research conducted within the Inflation Persistence Network (IPN), a team of Eurosystem economists undertaking joint research on inflation persistence in the euro area and in its member countries. The research of the IPN combines theoretical and empirical analyses using three data sources: individual consumer and producer prices; surveys on firms' price-setting practices; aggregated sectoral, national and area-wide price indices. Patterns, causes and policy implications of inflation persistence are addressed.The IPN is chaired by Ignazio Angeloni; Stephen Cecchetti (Brandeis University), Jordi Galí (CREI, Universitat Pompeu Fabra) and Andrew Levin (Board of Governors of the Federal Reserve System) act as external consultants and Michael Ehrmann as Secretary.The refereeing process is co-ordinated by a team composed of Vítor Gaspar (Chairman), Stephen Cecchetti, Silvia Fabiani, Jordi Galí, Andrew Levin, and Philip Vermeulen. The paper is released in order to make the results of IPN research generally available, in preliminary form, to encourage comments and suggestions prior to final publication. The views expressed in the paper are the author's own and do not necessarily reflect those of the Eurosystem. C O N T E N T S Abstract 4Non-technical summary 5

Aggregate Demand, Idle Time, and Unemployment

“…Purchasing occupations include purchasing managers, buyers and purchasing agents, and procurement clerks. Panel C: The share of sales to long-term customers is from the following firm surveys: Kwapil, Baumgartner, and Scharler (2005) for Austria (AT); Aucremanne and Druant (2005) for Belgium (BE); Stahl (2005) for Germany (DE); Alvarez and Hernando (2005) for Spain (ES); Loupias and Ricart (2004) for France (FR); Fabiani, Gattulli, and Sabbatini (2004) for Italy (IT); Lunnemann and Matha (2006) for Luxembourg (LU); Martins (2005) for Portugal (PT); Apel, Friberg, and Hallsten (2005) for Sweden (SE); Hall, Walsh, and Yates (2000) for the United Kingdom; and Blinder et al (1998) for the United States. All the surveys were conducted between 2000 and 2004, except in the United Kingdom and the United States where they were conducted in 1995 and 1990-1992.…”

Heterogeneity in Consumer Price Stickiness: A Microeconometric Investigation

“…For instance, recent specific surveys about firms pricing behaviors that have been conducted in the euro area (see Fabiani et al , 2004, as well as, for evidence on France, Loupias and Ricart, 2004, ) suggest that, as regards price adjustments, firms react differently when their production costs (or the demand for their product) rise or decrease. Indeed, firms react faster to a rising cost and a lowering demand than to changes going the other way round.…”

The Pricing Behaviour of Firms in the Euro Area: New Survey Evidence

“…2 For a very early example of this kind of work, see Hall and Hitch (1939). 3 The detailed results for each country can be found in the country-specific studies conducted in the framework of the IPN: Kwapil et al (2005) for Austria (AT), Aucremanne and Druant (2005) for Belgium (BE), Loupias and Ricart (2004) for France (FR), Stahl (2005) for Germany (DE), Fabiani et al (2004) for Italy (IT), Lünnemann and Mathä (2005) for Luxembourg (LU), Hoeberichts and Stokman (2005) for the Netherlands (NL), Martins (2005) for Portugal (PT), and Álvarez and Hernando (2005) for Spain (ES). These works can be withdrawn from the ECB website.…”