Maarten Dossche
Economics
- Division
Business Cycle Analysis
- Current Position
-
Adviser
- Fields of interest
-
Macroeconomics and Monetary Economics,Mathematical and Quantitative Methods,Microeconomics
- Education
- 2004-2008
PhD in Economics, Ghent University, Belgium
- 2006-2007
Visiting student, Universitat Pompeu Fabra, Barcelona, Spain
- 2000-2001
MSc in Economics, London School of Economics, United Kingdom
- 1996-2000
Licentiate in Economics, Ghent University, Belgium
- 1998-1999
Visiting student, Kiel University, Germany
- Professional experience
- 2022-
Adviser - Business Cycle Analysis Division, Directorate General Economics, European Central Bank
- 2020-2021
Senior Lead Economist - Business Cycle Analysis Division, Directorate General Economics, European Central Bank
- 2016-2019
Principal Economist - Business Cycle Analysis Division, Directorate General Economics, European Central Bank
- 2014-2016
Senior Economist - Output and Demand Division, Directorate General Economics, European Central Bank
- 2012-2014
Senior Economist - Monetary Policy Section, Research Department, National Bank of Belgium
- 2010-2012
Economist - Monetary Policy Strategy Division, Directorate General Economics, European Central Bank
- 2001-2010
Economist - Prices and Costs Section, Research Department, National Bank of Belgium
- Awards
- 2005
Prize of the Economics Society Flanders
- 14 September 2022
- WORKING PAPER SERIES - No. 2719Details
- Abstract
- We use household surveys to describe differences in wages, income, wealth and liquid assets of households born in their country of residence (“natives”) vs. those born in other EU and non-EU countries (“immigrants”). The differences in wealth are more substantial than the differences in wages and incomes: immigrants earn on average about 30% lower wages than natives and hold roughly 60% less net wealth. For all variables, only a small fraction of differences between natives and immigrants—around 30%—can be explained by differences in demographics (age, gender, marital status, education, occupation, sector of employment). Immigrants are more likely to be liquidity constrained: while about 17% of natives can be labelled as “hand-to-mouth” (holding liquid assets worth less than two weeks of income), the corresponding share is 20% for households born in another EU country and 29% for those born outside the EU. Employment rates of immigrants are substantially more sensitive to fluctuations in aggregate employment. Monetary policy easing stimulates more strongly employment of individuals born outside the EU.
- JEL Code
- J15 : Labor and Demographic Economics→Demographic Economics→Economics of Minorities, Races, Indigenous Peoples, and Immigrants, Non-labor Discrimination
D31 : Microeconomics→Distribution→Personal Income, Wealth, and Their Distributions
E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy - Network
- Discussion papers
- 14 September 2022
- DISCUSSION PAPER SERIES - No. 21Details
- Abstract
- We use household surveys to describe differences in wages, income, wealth and liquid assets of households born in their country of residence (“natives”) vs. those born in other EU and non-EU countries (“immigrants”). The differences in wealth are more substantial than the differences in wages and incomes: immigrants earn on average about 30% lower wages than natives and hold roughly 60% less net wealth. For all variables, only a small fraction of differences between natives and immigrants—around 30%—can be explained by differences in demographics (age, gender, marital status, education, occupation, sector of employment). Immigrants are more likely to be liquidity constrained: while about 17% of natives can be labelled as “hand-to-mouth” (holding liquid assets worth less than two weeks of income), the corresponding share is 20% for households born in another EU country and 29% for those born outside the EU. Employment rates of immigrants are substantially more sensitive to fluctuations in aggregate employment. Monetary policy easing stimulates more strongly employment of individuals born outside the EU.
- JEL Code
- J15 : Labor and Demographic Economics→Demographic Economics→Economics of Minorities, Races, Indigenous Peoples, and Immigrants, Non-labor Discrimination
D31 : Microeconomics→Distribution→Personal Income, Wealth, and Their Distributions
E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy
- 1 August 2022
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 5, 2022Details
- Abstract
- This box uses the ECB Consumer Expectations Survey (CES) to assess euro area household saving behaviour since the start of the coronavirus (COVID-19) pandemic. Most respondents reported that during the pandemic they were not able to increase their savings. Those that were able to do so reported that COVID-19-related restrictions/fear of infection and precautionary motives were the most important reasons for increasing their savings. In March 2021 the bulk of the savings accumulated during the pandemic were not expected to be spent until at least the spring of 2022. Most respondents expected to return to, but not exceed, their pre-COVID-19 levels of consumption as soon as pandemic restrictions were relaxed, suggesting limited scope for widespread pent-up demand during the recovery. Pandemic-related savings were concentrated among higher-income households with a relatively low exposure to energy-intensive expenditure. This limits the extent to which these savings are able to shield the ongoing recovery of consumption from the adverse impact of the recent surge in energy prices.
- JEL Code
- D12 : Microeconomics→Household Behavior and Family Economics→Consumer Economics: Empirical Analysis
D14 : Microeconomics→Household Behavior and Family Economics→Household Saving; Personal Finance
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
- 28 July 2022
- THE ECB BLOGRelated
- 19 October 2022
- THE ECB BLOG
- 14 September 2022
- THE ECB BLOG
- 25 April 2022
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 3, 2022Details
- Abstract
- The recent increase in energy prices raises the question of the extent to which households will reduce their consumption in response. This article reviews the drivers of the macroeconomic transmission of higher energy prices. It finds that in the first half of 2021 households regarded most of the rise in energy prices as being driven by stronger aggregate demand, leading to a recovery in consumption. However, since the summer of 2021 price rises caused, among other things, by disruptions in the supply of energy have increasingly weighed on household spending. This article also analyses the distributional impact of higher energy prices. Because poorer households spend a relatively large percentage of their income on energy, their purchasing power is particularly affected when energy prices surge. While monetary policy may have a limited role to play in counteracting the fallout from supply-driven changes in energy prices, targeted fiscal policies seem well suited to addressing the impact on the most affected households.
- JEL Code
- C23 : Mathematical and Quantitative Methods→Single Equation Models, Single Variables→Panel Data Models, Spatio-temporal Models
C32 : Mathematical and Quantitative Methods→Multiple or Simultaneous Equation Models, Multiple Variables→Time-Series Models, Dynamic Quantile Regressions, Dynamic Treatment Effect Models, Diffusion Processes
D39 : Microeconomics→Distribution→Other
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
- 12 January 2022
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 8, 2021Details
- Abstract
- This box reviews how the ECB’s communication on the economic outlook has evolved over time and how it compares with that of two other major central banks. Standard metrics reveal that over time the communication on the economic outlook has gradually become clearer, making monetary policy more transparent and effective. The ECB’s communication differs from that of the Bank of England and the Federal Reserve Board, reflecting the differences in their monetary policy strategies. The ECB uses the term “money” more often, while the Bank of England and the Federal Reserve Board communicate the terms “unemployment” and “slack” more frequently. Textual analysis underscores the importance of narratives in communicating quantitative economic forecasts. To build informative narratives, the ECB relies on a wide range of economic models, tools and surveys.
- JEL Code
- E30 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→General
E50 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→General
- 8 December 2021
- OCCASIONAL PAPER SERIES - No. 287Details
- Abstract
- The Consumer Expectations Survey (CES) is an important new tool for analysing euro area household economic behaviour and expectations. This new survey covers a range of important topical areas including consumption and income, inflation and gross domestic product (GDP) growth, the labour market, housing market activity and house prices, and consumer finance and credit access. The CES, which was launched as a pilot in January 2020, is a mixed frequency modular survey, which is conducted online. The survey structure and centralised data collection ensures the collection of harmonised quantitative and qualitative euro area information in a timely manner that facilitates direct cross-country comparisons. During the pilot phase, it was conducted for the six largest euro area countries and contained 10,000 individual respondents. In the context of the coronavirus (COVID-19) pandemic, the CES has been used to gather useful information on the impact of the crisis on the household sector and the effectiveness of policy measures to mitigate the effects of the pandemic. The CES also collects information on the public’s overall trust in the ECB, their knowledge about its objectives and the channels through which they learn about its monetary policy and other central bank-related topics. This paper describes the key features of this new ECB survey – including its statistical properties – and offers a first evaluation of the results from the pilot phase. It also identifies a number of areas where the survey can be usefully developed further. Overall, the experience with the CES has been very positive, and the pilot survey is considered to have achieved its main objectives.
- JEL Code
- C42 : Mathematical and Quantitative Methods→Econometric and Statistical Methods: Special Topics→Survey Methods
D12 : Microeconomics→Household Behavior and Family Economics→Consumer Economics: Empirical Analysis
D14 : Microeconomics→Household Behavior and Family Economics→Household Saving; Personal Finance
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation
- 21 September 2021
- OCCASIONAL PAPER SERIES - No. 275Details
- Abstract
- This report discusses the role of the European Union’s full employment objective in the conduct of the ECB’s monetary policy. It first reviews a range of indicators of full employment, highlights the heterogeneity of labour market outcomes within different groups in the population and across countries, and documents the flatness of the Phillips curve in the euro area. In this context, it is stressed that labour market structures and trend labour market outcomes are primarily determined by national economic policies. The report then recalls that, in many circumstances, inflation and employment move together and pursuing price stability is conducive to supporting employment. However, in response to economic shocks that give rise to a temporary trade-off between employment and inflation stabilisation, the ECB’s medium-term orientation in pursuing price stability is shown to provide flexibility to contribute to the achievement of the EU’s full employment objective. Regarding the conduct of monetary policy in a low interest rate environment, model-based simulations suggest that history-dependent policy approaches − which have been proposed to overcome lasting shortfalls of inflation due to the effective lower bound on nominal interest rates by a more persistent policy response to disinflationary shocks − can help to bring employment closer to full employment, even though their effectiveness depends on the strength of the postulated expectations channels. Finally, the importance of employment income and wealth inequality in the transmission of monetary policy strengthens the case for more persistent or forceful easing policies (in pursuit of price stability) when interest rates are constrained by their lower bound.
- JEL Code
- E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy
E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
- 2 August 2021
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 5, 2021Details
- Abstract
- The propensity of households to save has reached extraordinary levels since early 2020. This box analyses the drivers of this surge and tries to infer what they imply for private consumption as the pandemic is brought under control. On the one hand, the spike in household savings mostly comprises involuntary savings held to a large extent in the form of liquid assets, while the effects of the pandemic on household income have been limited. On the other hand, the additional savings are concentrated among older and higher-income households which, together with the services-led nature of the slump in consumption, suggests that these savings have only a limited potential to boost private consumption. Overall, the underlying drivers of the recent surge in household savings do not suggest much of an additional boost to the expected rebound in private consumption in the coming year.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 22 June 2021
- WORKING PAPER SERIES - No. 2571Details
- Abstract
- Labor productivity is more procyclical in OECD countries with lower employment volatility. To capture this new stylized fact, we propose a business cycle model with employment adjustment costs, variable hours and labor effort. We show that, in our model with variable effort, greater labor market frictions are associated with procyclical labor productivity as well as stable employment. In contrast, the constant-effort model fails to replicate the observed cross-country pattern in the data. By implication, labor market deregulation has a greater effect on the cyclicality of labor productivity and on the relative volatility of employment when effort can vary.
- JEL Code
- E30 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→General
E50 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→General
E60 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→General
- 24 March 2021
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 2, 2021Details
- Abstract
- This article reviews recent evidence on the interaction between monetary policy and household inequality. While economic inequality has been trending upwards in most advanced economies since the early 1980s, this analysis concludes that monetary policy has not been a major driver of those long-term trends. On the contrary, the accommodative monetary policies of recent years have had an equalising effect, particularly through employment gains for lower income households. Moreover, there is now more evidence showing that the distribution of income and wealth plays a key role in the transmission of monetary policy to household spending. However, while improvements to models and data have contributed to a better understanding of the ways in which household heterogeneity shapes the transmission of monetary policy, several unsolved puzzles remain, necessitating further research efforts.
- JEL Code
- D3 : Microeconomics→Distribution
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy
- 22 September 2020
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 6, 2020Details
- Abstract
- In response to COVID-19 the euro area household saving rate reached unprecedented levels in the first half of 2020. First, lockdown measures prohibited households from consuming a large share of their normal expenditure basket, leading to forced savings. Second, the sudden outbreak of the pandemic caused the risk of future unemployment to shoot up, leading to precautionary savings. Using a parsimonious panel model this box finds that forced savings have been the main driver of the recent spike in household savings. Despite these accumulated savings, however, households remain cautious about their future spending.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 17 June 2020
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 4, 2020Details
- Abstract
- This box reviews recent developments in short-time work and temporary lay-off schemes in the five largest euro area countries. It then calculates wage replacement rates and estimates take-up rates. Combining wage replacement rates with the estimated number of participants makes it possible to calculate the impact of short-time work on household disposable income. The box concludes that short-time work and temporary lay-off measures are significantly buffering the impact of COVID-19 on households’ disposable income.
- JEL Code
- E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
E65 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→Studies of Particular Policy Episodes
- 12 May 2020
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 3, 2020Details
- Abstract
- The growth slowdown in 2018-2019 was characterised by a marked divergence of industrial production and retail sales. This box seeks to uncover whether the euro area economy was hit by aggregate or sectoral shocks in this period. It finds that most of the growth slowdown can be explained by a series of adverse sectoral shocks. It also finds that, on average, sectoral shocks have a less persistent impact on economic activity than aggregate shocks. The recent COVID-19 shock is undoubtedly an aggregate shock. Yet its impact on economic activity over time remains very uncertain as its characteristics differ substantially from past aggregate shocks.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E23 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Production
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 25 September 2019
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 6, 2019Details
- Abstract
- Evidence suggests that household income risk is an important factor in the propagation of macroeconomic shocks and the transmission of economic policy. An analysis using survey data on income from the euro area suggests that the nature of household income risk in the euro area is comparable with the United States, in that (i) individual earnings risk is closely linked to the performance of the labour market, and (ii) in a downturn it increases much more for some groups of workers than for others. These insights are useful for assessing the current economic outlook and the role of income risk in amplifying macroeconomic shocks.
- JEL Code
- E20 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→General
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
- 21 December 2018
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 8, 2018Details
- Abstract
- Growth in economic activity has moderated significantly in the euro area since the end of 2017. Indeed, quarter-on-quarter GDP growth in the euro area fell to 0.2% in the third quarter of 2018, down from 0.7% in the fourth quarter of 2017. This box assesses the factors which are contributing to that slowdown and looks at whether it should be considered a surprise. In particular, it looks at whether the underlying factors are temporary or of a more permanent nature, whether they have originated within the euro area or externally, and whether the slowdown has been driven by a weakness in demand or a tightening of supply conditions.
- JEL Code
- E20 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→General
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 24 September 2018
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 6, 2018Details
- Abstract
- Oil prices affect private consumption through direct and indirect channels. An increase in oil prices affects households' purchasing power directly through higher prices for oil-based energy products (e.g. petrol, heating oil). In the euro area about one-third of the economy's total oil use is in the form of final consumption, i.e. the use by consumers of such products. The other two-thirds comes from oil being used in the production of non-energy goods. A rise in oil prices implies an increase in the production costs of these sectors. If these costs cannot be passed on to the final prices of these goods, there will be an indirect impact on households' purchasing power, since either wages or profits received from these sectors will be lower. Moreover, for advanced economies that produce oil (e.g. Canada, Norway, the United Kingdom and the United States) the indirect effects through wages and profits from the oil-producing sector are even more important.
- JEL Code
- E01 : Macroeconomics and Monetary Economics→General→Measurement and Data on National Income and Product Accounts and Wealth, Environmental Accounts
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
- 8 August 2018
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 5, 2018Details
- Abstract
- This article documents the key role that private consumption has played in recent output growth (2013-18), and asks how long the current growth in consumption can continue and whether it is self-sustaining. To that end, this article tries to identify the relative importance of different factors driving consumption, such as the recovery in the labour market, accommodative monetary policy, the 2014-15 drop in oil prices, the increase in asset prices, the easing of credit conditions and deleveraging. As the fall in consumption from 2008 to 2013 was very heterogeneous across countries, this article also sheds light on the extent to which the current expansion has actually led to a net increase in consumption over the past decade. This is relevant because private consumption is also a prime indicator of the economic well-being of households. While the growth of consumption has been low compared with previous expansions, since 2013 it has exceeded initial expectations. It has been driven mainly by the recovery in the labour market, even though unemployment in some countries and for some groups of workers remains higher than before 2008. Looking forward, as labour markets continue to improve, private consumption should expand further in all countries and for all groups of workers. Through its impact on the labour market, the ECB’s accommodative monetary policy is not only contributing to the expansion of private consumption, but also to a decrease in inequality. At the same time, there is little evidence that low interest rates have led to generalised increases in household indebtedness, supporting the sustainability of the overall economic expansion.
- JEL Code
- D31 : Microeconomics→Distribution→Personal Income, Wealth, and Their Distributions
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
E50 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→General
- 6 February 2018
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 1, 2018Details
- Abstract
- Growth in the consumption of durable goods has been very strong in recent years. During the financial crisis, durable goods consumption contracted sharply, although the car scrappage schemes in several euro area countries provided some relief by encouraging purchases of new cars (e.g. in 2009). Since 2013, durable goods consumption has again grown vigorously, pushing up growth in overall consumption. The recovery observed in real disposable incomes and the easing of financing conditions have both boosted households’ appetite for durable goods, particularly in those euro area countries that were more affected by the financial crisis.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 12 August 2014
- WORKING PAPER SERIES - No. 1713Details
- Abstract
- We characterize optimal monetary policy in a New Keynesian search-and-matching model where multiple-worker firms satisfy demand in the short run by adjusting hours per worker. Imperfect product market competition and search frictions reduce steady state hours per worker below the efficient level. Bargaining results in a convex
- JEL Code
- E30 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→General
E50 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→General
E60 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→General
- 14 February 2007
- WORKING PAPER SERIES - No. 727Details
- Abstract
- This paper documents producer price setting in 6 countries of the euro area: Germany, France, Italy, Spain, Belgium and Portugal. It collects evidence from available studies on each of those countries and also provides new evidence. These studies use monthly producer price data. The following five stylised facts emerge consistently across countries. First, producer prices change infrequently: each month around 21% of prices change. Second, there is substantial cross-sector heterogeneity in the frequency of price changes: prices change very often in the energy sector, less often in food and intermediate goods and least often in non-durable non-food and durable goods. Third, countries have a similar ranking of industries in terms of frequency of price changes. Fourth, there is no evidence of downward nominal rigidity: price changes are for about 45% decreases and 55% increases. Fifth, price changes are sizeable compared to the inflation rate. The paper also examines the factors driving producer price changes. It finds that costs structure, competition, seasonality, inflation and attractive pricing all play a role in driving producer price changes. In addition producer prices tend to be more flexible than consumer prices.
- JEL Code
- E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation
D40 : Microeconomics→Market Structure and Pricing→General
C25 : Mathematical and Quantitative Methods→Single Equation Models, Single Variables→Discrete Regression and Qualitative Choice Models, Discrete Regressors, Proportions - Network
- Eurosystem inflation persistence network
- 5 May 2006
- WORKING PAPER SERIES - No. 618Details
- Abstract
- This paper documents the patterns and determinants of price setting in the Belgian industry. We analyse the micro data underlying the Producer Price Index (PPI) over the period from February 2001 to January 2005. On average only one out of four prices changes in a typical month, whereas the absolute size of a price change amounts to 6%. The frequencies of price adjustment are particularly heterogeneous across sectors, which is determined by heterogeneity in the market and cost structure. We find no signs of downward nominal rigidity. A joint analysis of sizes and frequencies of price adjustment across time shows that price setting is characterised by both time- and state-dependent pricing. About 38% of the exported goods are a
- JEL Code
- D40 : Microeconomics→Market Structure and Pricing→General
E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation - Network
- Eurosystem inflation persistence network
- 21 June 2005
- WORKING PAPER SERIES - No. 495Details
- Abstract
- Time series estimates of inflation persistence incur an upward bias if shifts in the inflation target of the central bank remain unaccounted for. Using a structural time series approach we measure different sorts of inflation persistence allowing for an unobserved time-varying inflation target. Unobserved components are identified using Kalman filtering and smoothing techniques. Posterior densities of the model parameters and the unobserved components are obtained in a Bayesian framework based on importance sampling. We find that inflation persistence, expressed by the half-life of a shock, can range from 1 quarter in case of a cost-push shock to several years for a shock to long-run inflation expectations or the output gap.
- JEL Code
- C11 : Mathematical and Quantitative Methods→Econometric and Statistical Methods and Methodology: General→Bayesian Analysis: General
C13 : Mathematical and Quantitative Methods→Econometric and Statistical Methods and Methodology: General→Estimation: General
C22 : Mathematical and Quantitative Methods→Single Equation Models, Single Variables→Time-Series Models, Dynamic Quantile Regressions, Dynamic Treatment Effect Models &bull Diffusion Processes
C32 : Mathematical and Quantitative Methods→Multiple or Simultaneous Equation Models, Multiple Variables→Time-Series Models, Dynamic Quantile Regressions, Dynamic Treatment Effect Models, Diffusion Processes
E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation - Network
- Eurosystem inflation persistence network
- 2022
- Review of Economic Dynamics
- 2021
- Monetary Policy in Times of CrisisThe impact of the PSPP and negative interest rate policy on savers and borrowers
- 2019
- Journal of Monetary Economics
- 2019
- BIS Working Papers
- 2017
- International Journal of Central Banking
- 2013
- Economic Review, National Bank of Belgium
- 2012
- Journal of Money, Credit and Banking
- 2010
- Scandinavian Journal of Economics
- 2010
- Journal of Economic Dynamics and Control
- 2010
- Economic Review, National Bank of Belgium
- 2009
- Review of Business and Economic Literature
- 2008
- Scandinavian Journal of Economics
- 2004
- Economic Inquiry