Melinda Suveg doktorerar med "Finance, Shocks, Competition and Price Setting"

2021-09-07

Melinda Suveg försvarar sin avhandling "Finance, Shocks, Competition and Price Setting", 13 september, 10:15 i Hörsal 2 på Ekonomikum. Disputationen sker digitalt men det finns ett begränsat antal platser för dem som vill följa den på plats.

Melinda Suveg

Avhandlingen består av tre uppsatser om företagens prissättningsbeteende och dess betydelse för makroekonomin. Med hjälp av data för svenska företag undersöker uppsatserna (i) om producentpriserna stiger när Riksbanken höjer styrräntan (ii) om de återstående företagen höjer priserna när några av deras konkurrenter lämnar marknaden och (iii) om företagen sätter högre priser när det råder större osäkerhet om priserna på deras insatsvaror.

Opponent är professor Richard Friberg, Handelshögskolan i Stockholm och betygsnämndens ledamöter är professor Karolina Ekholm, Nationalekonomiska institutionen, Stockholms universitet, professor Mikael Carlsson, Nationalekonomiska institutionen, Uppsala universitet och professor Anders Ögren, ekonomisk-historiska institutionen, Uppsala universitet.

Handledare är professor Nils Gottfries, Nationalekonomiska institutionen, Uppsala universitet, David Vestin, senior advisor, Sveriges Riksbank och docent Teodora Borota Milicevic, Nationalekonomiska institutionen, Uppsala universitet.

Abstract (english)

Essay I: The New Keynesian model augmented with the working capital channel predicts that (i) a rise in the policy rate increases producer prices, with a stronger impact on firms that use more working capital, (ii) the pass-through of policy rate changes to prices is gradual because of price rigidity and (iii) unanticipated policy rate changes have larger effects than anticipated changes. Using firm-level micro data, I test these predictions. I show that a firm with average working capital holdings increases its price by 0.1 percent after 3 months and by 0.2 percent after 6 months following a percentage unit increase in the policy rate.

Essay II: This paper examines how changes in product market concentration, specifically firm exit, affect prices. I develop a model where firms have variable markups to show that the remaining firms increase their markups and prices after their competitors' exit. The model predictions are tested using micro-data on Swedish firms. I use the exposure of firms to a bank, which was severely affected by the financial crisis abroad, as an instrument to identify the causal relationship between firm exit and prices. I find that the remaining firms increase their prices by 0.3 percent when firms with a combined market share of one percent exit.

Essay III (with Sneha Agrawal and Abhishek Gaurav): In this paper, we study a new channel to explain firms' price setting behavior. We propose that uncertainty about factor prices has a positive effect on markups. We show theoretically that firms with higher shares of inputs with volatile prices set higher markups. We use the Bartik shift-share approach to empirically test whether firms which use more oil relative to other inputs set higher markups when oil prices are more volatile. Our estimates imply that a one standard deviation increase in oil price volatility leads to a 0.38 percent increase in the markup of firms with average oil exposure.

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Senast uppdaterad: 2021-08-27