, empirical frequencies of micro price adjustment cannot replicate the time-series properties of the law-of-one-price deviations …. We extend their sticky price model by combining good specific price adjustment with information stickiness in the sense … cities within a country. Using a panel of U.S.-Canadian city pairs, we estimate a dynamic price adjustment process for each …

' currencies, nominal exchange rate flexibility cannot achieve any relative price adjustment. In that case nominal exchange rate …