The Inflationary Consequences of a Currency Changeover on the Catering Sector: Evidence from the Michelin Red Guide
Giancarlo Marini and
Bristol Economics Discussion Papers from School of Economics, University of Bristol, UK
This paper examines the inflationary consequences of a currency changeover in the catering market. Empirical evidence from the Michelin Red Guide shows that: i) differently from restaurants in non-euro countries, restaurants in the euro area experienced abnormal price increases just after the changeover, ii) among restaurants in the euro area, tourist restaurants are responsible for most of the abnormal price increases. These results suggest that proposed explanations for the changeover effect such as menu adjustment and rounding up are only part of the story. We present a simple model of the catering market that is consistent with the evidence.
Keywords: Restaurants; Tourists; Euro; Currency Changeover. (search for similar items in EconPapers)
JEL-codes: D43 D82 E31 F33 (search for similar items in EconPapers)
Pages: 54 pages
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Journal Article: The Inflationary Consequences of a Currency Changeover on the Catering Sector: Evidence from the Michelin Red Guide* (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:bri:uobdis:08/604
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