Abstract

http://ssrn.com/abstract=319966
 
 

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Why Don't Prices Rise During Periods of Peak Demand? Evidence from Scanner Data


Peter E. Rossi


University of California, Los Angeles (UCLA) - Anderson School of Management

Judith A. Chevalier


Yale School of Management; National Bureau of Economic Research (NBER)

Anil K. Kashyap


University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

July 2002

Yale SOM Working Paper No. MK-12

Abstract:     
We examine retail and wholesale prices for a large supermarket chain over seven and one-half years. We find that prices fall on average during seasonal demand peaks for a product, largely due to changes in retail margins. Retail margins for specific goods fall during peak demand periods for that good, even if these periods do not coincide with aggregate demand peaks for the retailer. This is consistent with "loss leader" models of retailer competition. Models stressing cyclical demand elasticities or cyclical firm conduct are less consistent with our findings. Manufacturer behavior plays a limited role in the counter-cyclicality of prices.

Number of Pages in PDF File: 64

Keywords: Pricing, Seasonality, Retail, Competition

JEL Classification: L13, E32, L81

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Date posted: September 10, 2002  

Suggested Citation

Rossi , Peter E. and Chevalier, Judith A. and Kashyap, Anil K., Why Don't Prices Rise During Periods of Peak Demand? Evidence from Scanner Data (July 2002). Yale SOM Working Paper No. MK-12. Available at SSRN: http://ssrn.com/abstract=319966 or http://dx.doi.org/10.2139/ssrn.319966

Contact Information

Peter E. Rossi (Contact Author)
University of California, Los Angeles (UCLA) - Anderson School of Management ( email )
110 Westwood Plaza
Los Angeles, CA 90095-1481
United States
773-294-8616 (Phone)
Judith A. Chevalier
Yale School of Management ( email )
135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Anil K. Kashyap
University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7260 (Phone)
773 702-0458 (Fax)
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
773-702-7260 (Phone)
773-702-0458 (Fax)
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