Attractive Prices and Euro-Rounding Effects on Inflation

L. Aucremanne and D. Cornille

Working Papers from Warwick - Development Economics Research Centre

Abstract: Approximately 70% of Belgian consumer prices are to be considered as attractive prices, namely psychological prices, fractional prices - i.e. prices which are convenient to pay - and round prices. Conversion to these prices into euro generally leads to prices which are no longer attractive and it is very likely that retailers will round their prices to attractive euro prices. The public fears that rouding will be upward than symmetric. This paper simulates in the first instancea worst-case scenario, whereby all attractive BEF prices are systematically rounded up to the nearest attractive euro price.

Keywords: PRIX; CONSUMPTION (search for similar items in EconPapers)
JEL-codes: E30 E31 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2001
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Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:fth:warwde:17

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