We develop a unified approach to studying cost-price dynamics in the cross-section of firms in order to explain the time series of aggregate inflation, both during normal times and inflation surges. A key novelty is the use of microdata on firms’ prices and production costs to construct an empirical measure of price gaps—the deviation between a firm’s listed and optimal price. We characterize the mapping between price gaps and the size and frequency of price adjustments and take them to the

Tag-uri: Inflatie