Pricing in inflationary times- the penny drops

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

No 270749, Economic Research Papers from University of Warwick - Department of Economics

Abstract: We investigate micro pricing behaviour in groceries (the UK’s most important consumer market) over eight years including the inflationary period of early 2008. We find behaviour sharply distinguished from most previous work, namely that overall basket prices rise but more individual prices fall than rise! This is consistent with retailers obscuring the fact of rising basket prices. We employ a significant new source of data that captures cross-competitor interplay in prices at a very detailed level. Unusually but importantly, our work takes into account that consumers buy baskets of goods, rather than individual products, when shopping at supermarkets.

Keywords: Financial; Economics (search for similar items in EconPapers)
Pages: 35
Date: 2011-12
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Related works:
Journal Article: Pricing in inflationary times: The penny drops (2015)
Working Paper: Pricing in inflationary times- the penny drops (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:270749

DOI: 10.22004/ag.econ.270749

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