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The Impact of Non-financial Factors on Heterogeneous Sectoral Price and Output

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  • Juan de Dios Tena

Abstract

This paper documents and analyses output and price reactions to monetary shocks for 13 manufacturing sectors in the UK. It is found that market share turns out to be a key variable for explaining heterogeneity of industrial price adjustment to monetary shocks in the sense that firms in concentrated industries have more power to adjust prices to demand shocks. However, sectoral output movements are better explained by the traditional interest rate channel.

Suggested Citation

  • Juan de Dios Tena, 2006. "The Impact of Non-financial Factors on Heterogeneous Sectoral Price and Output," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 52(3), pages 19-29.
    • Handle: RePEc:aeq:aeqaeq:v52_y2006_i3_q3_p19-29
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    References listed on IDEAS

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    1. Strongin, Steven, 1995. "The identification of monetary policy disturbances explaining the liquidity puzzle," Journal of Monetary Economics, Elsevier, vol. 35(3), pages 463-497, June.
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    More about this item

    Keywords

    credit channel; interest rate channel; market structure;
    All these keywords.

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables

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