All Rights Reserved
AccessEcon LLC 2006, 2008.
Powered by MinhViet JSC

Steffen Ahrens and Matthias Hartmann
''Cross-sectional evidence on state-dependent versus time-dependent price setting''
( 2015, Vol. 35 No.4 )
We empirically analyze aggregate price setting by means of a nonparametric representation of the structural New Keynesian Phillips curve derived from Calvo (1983) pricing for a large cross-section of 14 industrialized economies. State-dependence of the Calvo parameter is tested in a functional-coefficient regression framework. We reject state-invariant pricing. Moreover, problems reported in the extant literature of insignificant and implausible estimates of the Phillips-curve relation are mitigated in the state-dependent specification.
Keywords: State-dependent versus time-dependent pricing, Phillips curve, Functional coefficients, Conditional heteroscedasticity.
JEL: C1 - Econometric and Statistical Methods: General
E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data)
Manuscript Received : Feb 17 2015 Manuscript Accepted : Dec 13 2015

  This abstract has been downloaded 1353 times                The Full PDF of this paper has been downloaded 154645 times