Textbook monetary economics views inflation as fundamentally driven by aggregate shocks, such as money supply or policy rates. This column presents empirical evidence that inflation is highly granular – it is significantly influenced by the prices set by a small number of large firms. Based on an analysis of 2.9 billion barcode-level transactions spanning 16 economies, it shows that firm-level idiosyncratic shocks account for a substantial share of inflation variability in advanced economies.

Tag-uri: Inflatie