4  BIS Review 67/2006  st  -  In addition, important structural elements of an economy, that influence the relation between inflation and the shocks to which an economy is subject are price flexibility and the anchoring of price setting. In the euro area prices are less flexible than in the US 3 .
Retailers reprice their products every 13 months, compared to 6.7 months in the US. Stickier prices imply that adjustments to external shocks operate more through changes in output, income and employment than would be the case in a situation where prices are more flexible. They also imply an increased persistence of inflation. Nevertheless, despite these rigidities, inflationary shocks dissipate quickly in the euro area.