%0 Report
        %A Balleer, Almut
%A Link, Sebastian
%A Menkhoff, Manuel
%A Zorn, Peter
        %T Demand or Supply? Price Adjustment during the COVID-19 Pandemic
        %D 2020
        %8 2020 Aug
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 13568
        %U https://www.iza.org/publications/dp13568
        %X We study price-setting behavior in German firm-level survey data to infer the relative importance of supply and demand during the Covid-19 pandemic. Supply and demand forces coexist, but demand shortages dominate in the short run. A reported negative impact of Covid-19 on current business is associated with a rise in the probability to decrease prices up to eleven percentage points. These results imply a role for aggregate demand stabilization policy to buffer the economic consequences of Covid-19 while containing the pandemic.
        %K producer price setting
%K supply
%K demand
%K COVID-19
%K fiscal policy