Asymmetric price adjustments: A supply side approach

Arbeitspapier

Using a model of dynamic price competition, this paper provides an explanation from the supply side for the well-established observation that retail prices adjust faster when input costs rise than when they fall. The opportunity of profitable storing for the next period induces competitive firms to immediately increase their prices in anticipation of higher future input costs. This relaxes competition and firms earn positive profits. Conversely, when input costs are expected to decline, firms adjust their prices only after a cost reduction materializes, and the firms' incentives for price undercutting lead to the standard Bertrand outcome.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: SFB/TR 15 Discussion Paper ; No. 493

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: Asymmetric price adjustments ; Bertrand-Edgeworth competition ; Storage ; Gasoline

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Antoniou, Fabio ; Fiocco, Raffaele ; Guo, Dongyu
• Ereignis: Veröffentlichung
• (wer): Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
• (wo): München
• (wann): 2015

Weitere Informationen

• DOI: doi:10.5282/ubm/epub.23804
• Handle: http://hdl.handle.net/10419/110397
• URN: urn:nbn:de:bvb:19-epub-23804-0
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ