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ETD Abstract Container

Abstract Header

Price stickiness: Durability, Cost of Price Adjustment and Price Memory

Zhumadilov, Daniyar
http://rave.ohiolink.edu/etdc/view?acc_num=miami1500057951315496

Abstract Details

2017, Master of Arts, Miami University, Economics.
Using online daily price data I explore the validity of a theory relating price stickiness to price adjustment costs in the form of price setters’ fear of alienating customers with frequent price changes. I argue that prices change more frequently for goods that are bought less often because of this price-setting strategy. I find that semi-durable goods (which are purchased more frequently than durable goods) change their prices less frequently than durable goods. However, non-durable goods change their prices more frequently than goods in other two categories. I attribute the latter relationship to the vital necessity of food, an important category within non-durable goods. While I find evidence that durable goods’ price-change frequency is consistent with all models of price-adjustment costs, semi-durable and non-durable goods have price adjustment costs that are positively related to their prices. I argue that this difference in price adjustment costs is due to customer alienation costs, which are derived from customers’ “price memory” (expectation of what a “fair” price for this good is).
Charles Moul (Advisor)
George Davis (Committee Member)
Jonathan Wolff (Committee Member)
23 p.
Economics
Price Stickiness; Cost of Price Adjustment; Price Memory; Billion Price Project; Menu Cost; Customer Alienation; Durable goods; Semi-durable goods; Non-durable goods; COICOP

Recommended Citations

Citations

  • Zhumadilov, D. (2017). Price stickiness: Durability, Cost of Price Adjustment and Price Memory [Master's thesis, Miami University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=miami1500057951315496

    APA Style (7th edition)

  • Zhumadilov, Daniyar. Price stickiness: Durability, Cost of Price Adjustment and Price Memory. 2017. Miami University, Master's thesis. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=miami1500057951315496.

    MLA Style (8th edition)

  • Zhumadilov, Daniyar. "Price stickiness: Durability, Cost of Price Adjustment and Price Memory." Master's thesis, Miami University, 2017. http://rave.ohiolink.edu/etdc/view?acc_num=miami1500057951315496

    Chicago Manual of Style (17th edition)

miami1500057951315496
387
© 2017, all rights reserved.
This open access ETD is published by Miami University and OhioLINK.
Release 3.2.12