The Price-Setting Behavior of Austrian Firms: Some Survey Evidence

68 Pages Posted: 20 May 2005

See all articles by Claudia Kwapil

Claudia Kwapil

Oesterreichische Nationalbank

Josef Baumgartner

Austrian Institute of Economic Research (WIFO)

Johann Scharler

Johannes Kepler University Linz - Department of Economics

Date Written: March 2005

Abstract

This paper explores the price-setting behavior of Austrian firms based on survey evidence. Our main result is that customer relationships are a major source of price stickiness in the Austrian economy. We also find that the majority of firms in our sample follows a time-dependent pricing strategy. However, a substantial fraction of firms deviates from time-dependent pricing in the case of large shocks and switches to a state-dependent pricing strategy. In addition, we present evidence suggesting that the price response to various shocks is subject to asymmetries.

Keywords: Price-setting behavior, Price rigidity

JEL Classification: C25, E30

Suggested Citation

Kwapil, Claudia and Baumgartner, Josef and Scharler, Johann, The Price-Setting Behavior of Austrian Firms: Some Survey Evidence (March 2005). Available at SSRN: https://ssrn.com/abstract=683155

Claudia Kwapil (Contact Author)

Oesterreichische Nationalbank ( email )

Otto-Wagner Platz 3
POB 61
Vienna 1011
Austria

Josef Baumgartner

Austrian Institute of Economic Research (WIFO) ( email )

P.O. Box 91
Wien, A-1103
Austria

Johann Scharler

Johannes Kepler University Linz - Department of Economics ( email )

Altenbergerstrasse 69
A-4040 Linz, 4040
Austria

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