What are price mark-up shocks?
| Authors | |
|---|---|
| Year of publication | 2025 |
| Type | Article in Periodical |
| Magazine / Source | APPLIED ECONOMICS LETTERS |
| MU Faculty or unit | |
| Citation | |
| web | https://doi.org/10.1080/13504851.2025.2491729 |
| Doi | http://dx.doi.org/10.1080/13504851.2025.2491729 |
| Keywords | Price mark-up shocks;dynamic stochastic general equilibrium models |
| Description | Using US data, we show that a large share of the variation in price mark-up shocks estimated from standard Dynamic Stochastic General Equilibrium (DSGE) models can be explained by energy and commodity price dynamics. We identify robust drivers of the price mark-up in the US and find that around 30% of the variation in their changes can be explained by variation in energy, metal and import prices. The explanatory power increases to over 60% if short-term fluctuations in price mark-ups are smoothed. |
| Related projects: |