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Weekday with Low Prices: Evidence on Daily Seasonality of Foods, Beverages, and Tobacco Prices

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  • Marcelo Delajara
  • José Antonio Murillo Garza
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    Abstract

    In this document we analyze the evidence of daily seasonality found in the weekly price variations of food, beverages, and tobacco in the Metropolitan Area of Mexico City. Our research is based on the daily price quotes of 2,724 goods, collected by Banco de México for the Consumer Price Index (CPI), in 434 commercial establishments between March 2009 and June 2010. We identify the weekday with the lowest weekly variation in prices, and find that it differs across products, types of commercial establishment, and supermarket chains. Moreover, we find that such a "day of the week" effect increases the volatility of the weekly variations of price quotes. These results establish the "day of the week" among the distinct characteristics of a price, a fact that must be taken into account while preparing calendars for CPI data collection.

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    File URL: http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/%7B6AE024E8-6DD6-CF6F-519C-17190CDE32B1%7D.pdf
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    Bibliographic Info

    Paper provided by Banco de México in its series Working Papers with number 2012-09.

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    Date of creation: Sep 2012
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    Handle: RePEc:bdm:wpaper:2012-09

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    Web page: http://www.banxico.org.mx
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    Related research

    Keywords: Daily prices; retail sales; seasonal price patterns; dynamic pricing policies; CPI methodologies.;

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    3. Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, Oxford University Press, number 9780195102680, October.
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    8. Abe, Naohito & Tonogi, Akiyuki, 2010. "Micro and macro price dynamics in daily data," Journal of Monetary Economics, Elsevier, Elsevier, vol. 57(6), pages 716-728, September.
    9. Timothy J. Richards, 2006. "Sales by multi-product retailers," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 27(4), pages 261-277.
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