This study investigates the pricing behaviour of firms in the euro area on the basis of surveys conducted by nine Eurosystem national central banks, covering more than 11,000 firms. The results, robust across countries, show that firms operate in monopolistically competitive markets, where...

This paper investigates the relationship between bilateral FDI positions and cross-country business cycle correlations in the period 1982–2001. We find that countries that have comparatively intensive FDI relations also have more synchronized business cycles during 1995–2001. Before 1995, we...

This paper presents original evidence on price setting in the euro area at the individual level. We use micro data on consumer (CPI) and producer (PPI) prices, as well as survey information. Our main findings are: (i) prices in the euro area are sticky and more so than in the US; (ii) there is...

This paper analyses information from survey data collected in the framework of the Eurosystem’s Wage Dynamics Network (WDN) on patterns of firm-level adjustment to shocks. We document that the relative intensity and the character of price vs. cost and wage vs. employment adjustments in...

This paper investigates the financing conditions of non-financial corporations in theeuro area. We develop a new firm classification based on micro data by distinguishingbetween three groups of firms: unconstrained, relatively and absolutely constrainedfirms. We also provide further evidence on...

We test whether firms with a single bank are better shielded from loss of credit and investment cutsin periods of adverse cash flow shocks than firms with multiple bank relationships. Our estimatesof the cash flow sensitivity of investment show that both types of firms are equally subject...

Volatilities implied from interest rate swaptions are used to assess the size and thesign of the compensation for volatility risk, for dollar, euro and pound rates at a dailyfrequency, between October 1998 and August 2006. The measurement of the volatilityrisk premium rests on a simple model...

We study both theoretically and empirically the interdependence of lending decisions in differentcountry branches of a multinational bank. First, we model a bank that delegates the management of itsforeign unit to a local manager with non-transferable skills. The bank differs from other...

We analyze the interlinkages between foreign direct investment (FDI) and foreignportfolio investment (FPI) between Germany and the major economies. First, we show thatTobin’s q helps explaining the variation of the growth rate of the stock of FDI. Second, weshow that foreign and the home stock...

This paper presents new evidence on the patterns of price and wage adjustment inEuropean firms and on the extent of nominal rigidities. It uses a unique dataset collectedthrough a firm-level survey conducted in a broad range of countries and covering varioussectors. Several conclusions are drawn...