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Pricing in inflationary times: The penny drops

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journal contribution
posted on 05.11.2020, 13:59 by Ratula Chakraborty, Paul W Dobson, Jonathan Seaton, Michael Waterson
© 2015 The Authors. How does the frequency and magnitude of micro-price rises and falls relate to macroeconomic crisis, as well as moderation? Weekly micropricing behaviour in British groceries was investigated across three leading retailers over the moderation period 2004-7 and the crisis period 2008-10. We find significant price flexibility sharply distinguished from behaviour observed in most previous works. Downward price flexibility increased markedly in 2008. Overall basket prices rise, but significantly more individual prices fall than rise in the latter period. Tests of obfuscation in price setting suggested that large numbers of small price falls were used to disguise the basket price rises.

Funding

ESRC funding for this project (Grant RES-062-23-1962)

History

School

  • Business and Economics

Department

  • Economics

Published in

Journal of Monetary Economics

Volume

76

Pages

71 - 86

Publisher

Elsevier BV

Version

VoR (Version of Record)

Rights holder

© The authors

Publisher statement

This is an Open Access Article. It is published by Elsevier under the Creative Commons Attribution 4.0 Unported Licence (CC BY). Full details of this licence are available at: http://creativecommons.org/licenses/by/4.0/

Acceptance date

10/08/2015

Publication date

2015-08-20

Copyright date

2015

ISSN

0304-3932

eISSN

1873-1295

Language

en

Depositor

Jonathan Seaton. Deposit date: 3 November 2020