Attractive Prices and Euro-Rounding Effects on Inflation
AbstractApproximately 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.
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Bibliographic InfoPaper provided by Warwick - Development Economics Research Centre in its series Papers with number 17.
Length: 35 pages
Date of creation: 2001
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- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
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- Wioletta Dziuda & Giovanni Mastrobuoni, 2009.
"The Euro Changeover and Its Effects on Price Transparency and Inflation,"
Journal of Money, Credit and Banking,
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"How frequently do prices change? Evidence based on the micro data underlying the Belgian CPI,"
Working Paper Series
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"Price setting behaviour in Spain: stylised facts using consumer price micro data,"
Banco de Espaï¿½a Working Papers
0422, Banco de Espa�a.
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