Tobias Renkin

I am a Research Economist at Danmarks Nationalbank. I work on topics in empirical Macroeconomics and Labor Economics.

Working Papers

• The Pass-Through of Minimum Wages into US Retail Prices: Evidence from Supermarket Scanner Data (2019), with Claire Montialoux and Michael Siegenthaler. Conditionally accepted, Review of Economics and Statistics.

  This paper estimates the pass-through of minimum wage increases into prices of US grocery stores. We use high-frequency scanner data and leverage a large number of state-level increases in minimum wages between 2001 and 2012. We find that a 10% minimum wage hike translates into a 0.2% increase in grocery prices. This magnitude is consistent with a full pass-through of cost increases into consumer prices. We show that price adjustments occur mostly in the three months following the passage of minimum wage legislation rather than after implementation, suggesting that pricing of groceries is forward-looking. Prices rise as much for goods consumed by low-income and for those consumed by high-income households. Depending on household income, grocery price increases offset between 3 and 12% of the nominal income gains. Our results suggest that consumers rather than firms bear the cost of minimum wage increases in the grocery sector. Yet, price increases in grocery stores offset only a small fraction of the income gains from minimum wage hikes for low-income households.

  Media coverage: Marginal Revolution, National Affairs Findings Blog, Brad Delong
• Export Prices, Markups, and Currency Choice after a Large Appreciation (2019), with Daniel Kaufmann. Submitted.

  We analyze export price adjustment of Swiss manufacturing firms using a novel data set of matched export, import, and domestic prices. After a large, unexpected, and permanent appreciation of the Swiss franc, export prices set in domestic currency fell less than export prices set in foreign currency. This difference prevails if we control for variation in firms' marginal cost. Through the lens of a structural model, this difference can be traced back to strategic complementarity in price setting for firms pricing in foreign currency. Meanwhile, firms setting prices in domestic currency exhibit no strategic complementarity and follow a constant markup-pricing rule.

• The Response of Retail Prices and Markups to Cyclical Demand Shocks (2017)

  I study the response of markups and prices of products sold in US grocery stores to cyclical demand shocks between 2006 and 2010. I first show that under plausible assumptions on the production technology of multiproduct retailers, I can identify causal effects on markups using a combination of fixed effects and appropriate demand shifters. I then use variation in products' income elasticity of demand to construct cyclical demand shifters that are plausibly unrelated to cyclical supply shocks. I find that in response to a positive 10% demand shock, markups decrease by up to 5pp. My results support theories of countercyclical product level markups as proposed, for example, in Ravn et. al. (2006, 2008).

Research in Progress

• Price-setting and Financial Constraints During the Great Recession: Evidence from Denmark, with Gabriel Züllig
• Wage-Price Pass-through in Denmark, with Simon Juul Hviid
• Markups and Monetary Policy, with Luca Riva and Marcel Peruffo

Policy Papers

• Manufacturing Prices and Employment after the Swiss Franc Shock, with Daniel Kaufmann, Study on behalf of the State Secretariat for Economic Affairs SECO, October 2017

  Media coverage: Neue Zürcher Zeitung I, Neue Zürcher Zeitung II, Tagesanzeiger I, Tagesanzeiger II, Die Volkswirtschaft (all in German), Radio Télévision Neuchâtel, Le Temps (in French), Reuters

• Liquidity reserves of Danish firms: Implications during the COVID-19 Epidemic, Danmarks Nationalbank Economic Memo, June 2020