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Factor price
About: Factor price is a research topic. Over the lifetime, 2764 publications have been published within this topic receiving 86176 citations.
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TL;DR: In this article, a Holmes-Hutton rank order procedure is used to determine if price changes in one market cause price change in the other market and thus define an integrated market.
Abstract: The purpose of this paper is to test for price integration in the British-French markets for lamb in the period after the introduction of the EC sheepmeat regime in 1980. A Holmes-Hutton rank order procedure is used to determine if price changes in one market cause price changes in the other market and thus define an integrated market. Using weekly price data for the period 1983-86, the results indicate that the British-French lamb markets are integrated in that a price change in one market is fully reflected in price changes in the other. However, there is considerable lag time in response to price changes. This may be attributed to less than perfect substitution between the British and French product, to the ex post nature of the clawback provision that existed in the British price support system during the period of analysis, and to informal trade barriers.
31 citations
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TL;DR: In this paper, the authors examine how the credibility of a policymaker affects the outcome of an announced disinflation in a model with endogenous time-dependent pricing rules and show that, in both cases, the interaction between the endogeneity of timedependent rules and imperfect credibility increases the output costs.
Abstract: The real effects of an imperfectly credible disinfl ation depend critically on the extent of price rigidity. Therefore, the study of how policymakers’ credibility affects the outcome of an announced disinflation should not be dissociated from the analysis of the determinants of the frequency of price adjustments. In this paper we examine how the policymaker’s credibility affects the outcome of an announced disinflation in a model with endogenous time-dependent pricing rules. Both the initial degree of price ridigity, calculated optimally, and, more notably, the changes in contract length during disinflation play an important role in the explanation of the effects of imperfect credibility. We initially evalute the costs of disinfl ation in as etup where credibility is exogenous, and then allow agents to update beliefs about the “type” of monetary authority that they face. We show that, in both cases, the interaction between the endogeneity of time-dependent rules and imperfect credibility increases the output costs of disinflation.
31 citations
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TL;DR: In this article, the authors estimate the textile industry's productivity and efficiency for the period 1975-93 utilizing a variable elasticity of substitution production function and show that despite job losses, the industry adjusted by increasing labor productivity and maintaining fairly stable profits.
Abstract: In light of the textile industry's growing foreign competition, trade deficit and job loss, we estimate its productivity and efficiency for the period 1975–93 utilizing a variable elasticity of substitution production function. The results indicate that, despite job losses, the industry adjusted by increasing labor productivity and maintaining fairly stable profits. This performance does not warrant protectionist policies. However, with an elasticity of factor substitution less than one and decreasing, the impact of factor price increases could result in higher apparel prices and preference for cheaper imports. Furthermore, with an elasticity of capital output rapidly decreasing, significant technological improvements will be required to improve competitiveness since textile production is capital intensive. Recently revised rules on trade liberalization could increase competition in the industry.
31 citations
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01 Jan 1998-Journal of Institutional and Theoretical Economics-zeitschrift Fur Die Gesamte Staatswissenschaft
TL;DR: In this paper, an alternative explanation for price rigidity as well as asymmetric price adjustment in the absence of menu costs is presented. But this explanation assumes that firms incur "menu costs" when they adjust their prices and there is little empirical evidence to substantiate this assumption.
Abstract: Recent empirical studies suggest that prices in highly concentrated industries tend to be rigid and that pricing is often asymmetric with price rises occurring more frequently than price reductions (Domberger [1987]). Existing explanations of price rigidity and asymmetric pricing assume that firms incur "menu costs" when they adjust their prices. There is, however, little empirical evidence to substantiate this assumption. This paper provides an alternative explanation for price rigidity as well as asymmetric price adjustment in the absence of menu costs. In an infinitely repeated duopoly with incomplete information, it is demonstrated that depending on the degree of collusion and parameters, a variety of pricing behaviour emerge in equilibrium.
31 citations