• N81;
  • N82;
  • E31;
  • L11
  • nominal price rigidity;
  • frequency of price change;
  • price flexibility;
  • price history;
  • micro-data prices;
  • cost of changing prices

This paper documents differences in the nominal rigidity of retail prices across two 28-month periods: 1889–91 and 1997–99. The most striking finding is that prices changed much less frequently in 1889–91. In the late-1800s when price changes did occur they were smaller on average and more narrowly distributed with fewer small or large price changes. Further, price changes were more permanent 100-plus years ago. These differences are consistent with a high occurrence of temporary price shocks and a higher cost of changing prices in 1889–91 than in 1997–99.