Are UK companies' prices sticky?

This paper reports results from a survey by the Bank of England in 1995 to assess the extent of price-stickiness in 654 UK companies. In the year before the survey, firms on average reviewed prices monthly but changed them only twice. Time-dependent pricing was far more prevalent than state-dependent pricing and there was also some evidence of asymmetries in price-responsiveness to shocks. Firms assessed the importance of particular (layman's descriptions of) theories of price stickiness. Few respondents rated menu costs as material to their price-setting decisions. But (explicit and implicit) contractual arrangements and costs were important factors in pricing behaviour.