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The Price of Delay: Supply Disruptions, Product Availability, and Strategic Pricing during the Pandemic

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Abstract

During 2020–23, firms did not just face higher costs but faced an unusually tight constraint on product availability. Imports often did not arrive when expected, and port congestion and vessel delays made replenishment unusually uncertain. In Baslandze and Fuchs (2026), we study how these disruptions showed up in consumer prices using newly linked micro data that match shipment-level bills of lading to high-frequency consumer transaction prices. The evidence points to sizable pass-through from delivery shortfalls to prices, above and beyond the standard pass-through of costs. Prices also rise when competitors experience shortfalls, consistent with scarcity weakening competitive pressure inside product markets. We use the estimates in an accounting exercise to calculate the direct and spillover price responses implied by widespread disruptions.

Suggested Citation

  • Salomé Baslandze & Simon Fuchs, 2026. "The Price of Delay: Supply Disruptions, Product Availability, and Strategic Pricing during the Pandemic," Policy Hub, Federal Reserve Bank of Atlanta, vol. 2026(4), pages 1-16, June.
    • Handle: RePEc:fip:a00068:103744
    DOI: 10.29338/ph2026-04
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    File URL: https://www.atlantafed.org/-/media/Project/Atlanta/FRBA/Documents/research/publication/policy-hub/2026/06/25/04-supply-disruptions-product-availability-and-strategic-pricing-during-pandemic.pdf
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    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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