Pricing in inflationary times: The penny drops

Ratula Chakraborty; Paul W. Dobson; Jonathan S. Seaton; Michael Waterson

doi:10.1016/j.jmoneco.2015.08.002

Pricing in inflationary times: The penny drops

Ratula Chakraborty, Paul W. Dobson, Jonathan S. Seaton, Michael Waterson

Research output: Contribution to journal › Article › peer-review

12 Citations (Scopus)

30 Downloads (Pure)

Abstract

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.

Original language	English
Pages (from-to)	71-86
Number of pages	16
Journal	Journal of Monetary Economics
Volume	76
Early online date	20 Aug 2015
DOIs	https://doi.org/10.1016/j.jmoneco.2015.08.002
Publication status	Published - Nov 2015

Keywords

Pricing behaviour
supermarket prices
inflationary behaviour
price indexes

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10.1016/j.jmoneco.2015.08.002Licence: CC BY

Chakraborty et al - Pricing in inflationary times - Journal of Monetary Economics - November 2015
& 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)
Final published version, 1.12 MBLicence: CC BY

Paul Dobson
- P.Dobsonuea.acuk
- Norwich Business School - Professor
- Centre for Competition Policy - Member
- Responsible Business Regulation Group - Member
Person: Research Group Member, Research Centre Member, Academic, Teaching & Research

Price Dynamics in Food Retailing in Great Britain
Dobson, P., Chakraborty, R., Seaton, J. & Waterson, M.
Economic and Social Research Council
1/07/10 → 31/03/12
Project: Research

Cite this

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title = "Pricing in inflationary times: The penny drops",

abstract = "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.",

keywords = "Pricing behaviour, supermarket prices, inflationary behaviour, price indexes",

author = "Ratula Chakraborty and Dobson, {Paul W.} and Seaton, {Jonathan S.} and Michael Waterson",

note = "& 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)",

year = "2015",

month = nov,

doi = "10.1016/j.jmoneco.2015.08.002",

language = "English",

volume = "76",

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T1 - Pricing in inflationary times: The penny drops

AU - Chakraborty, Ratula

AU - Dobson, Paul W.

AU - Seaton, Jonathan S.

AU - Waterson, Michael

N1 - & 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)

PY - 2015/11

Y1 - 2015/11

N2 - 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.

AB - 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.

KW - Pricing behaviour

KW - supermarket prices

KW - inflationary behaviour

KW - price indexes

U2 - 10.1016/j.jmoneco.2015.08.002

DO - 10.1016/j.jmoneco.2015.08.002

M3 - Article

VL - 76

SP - 71

EP - 86

JO - Journal of Monetary Economics

JF - Journal of Monetary Economics

SN - 0304-3932

ER -

Pricing in inflationary times: The penny drops

Abstract

Keywords

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Profiles

Paul Dobson

Projects

Price Dynamics in Food Retailing in Great Britain

Cite this