Work

What are price mark-up shocks?

Year: 2025

Type: article

Abstract: 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.

Source: Applied Economics Letters

DOI: 10.1080/13504851.2025.2491729

Authors: Jesús Crespo Cuaresma, Raffael Singer

Institutions: Vienna University of Economics and Business, University of Vienna, Austrian Institute of Economic Research, International Institute for Applied Systems Analysis, Masaryk University

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

Funders: Österreichischen Akademie der Wissenschaften, Grantová Agentura České Republiky

Award: On the time-varying predictive ability of theoretical and empirical macroeconomic models