No. 155: Understanding Firm Dynamics with Daily Data

Year: 2024

Type: Working Paper

Abstract

How do firms respond to macroeconomic shocks? To study this question, we construct novel daily time series that measure firms’ plans and expectations based on surveys from Germany. Daily variation allows us to estimate the short-run aggregate responses of firms in short samples. This allows us to analyze the post-pandemic inflation surge without relying on pre-pandemic data. We find that firms’ plans, notably price-setting plans, respond within days to oil supply and monetary policy shocks but not to forward guidance shocks. The effects are especially strong for small and non-tradeable sector firms. Finally, expectations respond strongly and swiftly, but only to monetary policy.

Publication Information

TRR 266 researchers

Davud Rostam-Afschar University of Mannheim

Prof. Dr. Davud Rostam-Afschar is academic director of the German Business Panel at the University of Mannheim. Previously, he was visiting researcher at UC Berkeley and Harvard University. He worked at the University of Hohenheim, the Freie Universität of Berlin, and as a consultant to the European Commission and the OECD. His research focuses on taxation and accounting, public economics, labor economics, and industrial economics.

External researchers

Lukas Hack

DOI

DOI Link

Cite this article as

Hack, L., & Rostam-Afschar, D. (2024). Understanding Firm Dynamics with Daily Data. TRR 266 Accounting for Transparency Working Paper Series No. 155. http://dx.doi.org/10.2139/ssrn.4944988

Related Projects

C01

German Business Panel

+ 10

Participating Institutions

TRR 266‘s main locations are Paderborn University (Coordinating University), HU Berlin, and University of Mannheim. All three locations have been centers for accounting and tax research for many years. They are joined by researchers from LMU Munich, Frankfurt School of Finance and Management, Goethe University Frankfurt, University of Cologne and Leibniz University Hannover who share the same research agenda.