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Markups as a Hedge for Input Price Uncertainty: Evidence from Sweden
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…
Working Paper
Publish date 11/16/2021
IFN Researcher
IFN Researcher
Trust Us to Repay: Social Trust, Long-Term Interest Rates, and Sovereign Credit Ratings
This paper asks whether the sensitivity of market long-term interest rates and credit ratings is associated with cross-country differences in informal institutions, measured by social trust. We note a…
Journal Article
Publish date 8/13/2021