End of 9-Endings and Price Perceptions

Haipeng (Allan) Chen (), Daniel Levy () and Avichai Snir

MPRA Paper from University Library of Munich, Germany

Abstract: We take advantage of a natural experiment to document an emergence of a new price ending that has the same effects as 9-endings. In January 2014, the Israeli parliament has passed a law prohibiting the use of non 0-ending prices. We find that one year after 9-ending prices have disappeared, 90-ending prices acquired the same status as 9-ending prices had before the law was passed. 90-ending prices became the new psychological price points. The retailers and the shoppers both reacted to the regulatory intervention optimally, which has eliminated the regulation’s intended effect.

Keywords: 9-ending prices; psychological price points; sticky prices; rigid prices; price recall; price control; price regulation; integer constraint (search for similar items in EconPapers)
JEL-codes: E31 K20 L16 (search for similar items in EconPapers)
Date: 2017-01-20
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/76342/7/MPRA_paper_76342.pdf original version (application/pdf)

Related works:
Working Paper: End of 9-Endings and Price Perceptions (2017)
Working Paper: End of 9-Endings and Price Perceptions (2017)
Working Paper: End of 9-Endings and Price Perceptions (2017)
Working Paper: End of 9-Endings and Price Perceptions (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:76342

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().