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Price theory is concerned with explaining economic activity in terms of the creation and transfer of value, which includes the trade of goods and services between difierent economic agents. A puzzling question addressed by price theory is, for example: why is water so cheap and diamonds
1 Introduction. Consumer retail prices exhibit a systematic combination of stickiness and exibility. The stickiness of prices|that they can remain unchanged for many months despite changing cost or demand circumstances|has long been considered a stylized fact in industrial organization.
Then, a price is drawn from the distribution and the consumer decides whether to buy a single item of the good. Our main result establishes that the optimal price distribution consists of low and variable “sale” prices and a high and atomic “regular” price. The sale prices are chosen such that it is not.
European Journal of Economics and Economic Policies: Intervention. On the empirical regularities of Sraffa prices
5 lut 2014 · We establish that for any degree of consumer loss aversion, the monopolist's optimal price distribution consists of low and variable “sale” prices and a high and atomic “regular” price.
price theory--the analysis of why things cost what they do and of how prices function to coordinate economic activity. This book is organized into six sections.
We study the cyclical properties of sales, regular price changes and average prices paid by consumers (“effective” prices) in a dataset containing prices and quantities sold for numerous retailers across a variety of U.S. metropolitan areas.
