Abstract

Price transmission path is quite complicated. Firstly, it includes both direct and indirect paths, secondly, the price transmission is accompanied with time-delay. The traditional Input-Output Price Model based on cost-push theory can efficiently solve the first problem, but it cannot reflect the dynamic characteristics of price transmission with time. This paper uses the Directed Weighted Network to formulate the price transmission between various industrial sectors by taking the temporal dimension into account. In order to effectively evaluate the impact of the delay of price transmission, a novel Price Transmission Network Model is constructed. Compared with the traditional Input-Output Price Model, the new model contributes to following tree points. First, this model can calculate the fluctuations of price transmission at any time, and the traditional model is a special asymptotic case. Second, this model considers the impact of different transmission delay, so that it can illustrate the price transmission process with higher accuracy. Third, this model can be implemented in computers easily and we also provide an algorithm for this implementation.

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