This book documents the underlying rationale of observed pricing patterns on the basis of survey information provided by more than 11,000 euro area firms. Knowing how firms set prices is crucial for central banks because it helps them understand the dynamics of aggregate inflation and throws light on how monetary impulses get transmitted through the economic system. Pricing Decisions in the Euro Area: How Firms Set Prices and Why is the first genuine attempt to document via direct surveys the mechanisms behind pricing decision of a large sample of entrepreneurs across a vast economic region. The book offers an unprecedented wealth of comparable microeconomic data and a key to interpret them, highlighting differences in pricing strategies among sectors, firm sizes and countries in the euro area, based on information that comes straight from the horse's mouth. It is a must-read for scholars and policymakers alike-a truly privileged observatory of how market forces at the micro level interact and contribute to macroeconomic outcomes. Two thumbs up.