Durability versus concentration as an explanation for price inflexibility

Elizabeth M. Caucutt, Mrinal G Ghosh, Christina M L Kelton

Research output: Contribution to journalArticle

18 Citations (Scopus)

Abstract

We document the extent of price rigidity across United States manufacturing industries in the 1980s and early 1990s and compare rigidity across different phases of the business cycle. We measure price rigidity in three ways - each under four different sets of assumptions. We take an approach that relies on disaggregated data; we look at price patterns for over 4000 individual manufactured commodities. Both durability and seller concentration are found to be important factors explaining differences in price rigidity across industrial product classes. Using our data, we replicate the regression results found in Carlton (1986) that were based on actual transaction prices from the 1960s.

Original languageEnglish (US)
Pages (from-to)27-50
Number of pages24
JournalReview of Industrial Organization
Volume14
Issue number1
DOIs
StatePublished - 1999
Externally publishedYes

Fingerprint

Rigidity
Durability
Industry
Price rigidity
Factors
Business cycles
Seller
Manufacturing industries
Commodities
Transaction price

Keywords

  • Administered pricing
  • Market concentration
  • Price rigidity
  • Product durability

ASJC Scopus subject areas

  • Economics and Econometrics
  • Management of Technology and Innovation
  • Strategy and Management

Cite this

Durability versus concentration as an explanation for price inflexibility. / Caucutt, Elizabeth M.; Ghosh, Mrinal G; Kelton, Christina M L.

In: Review of Industrial Organization, Vol. 14, No. 1, 1999, p. 27-50.

Research output: Contribution to journalArticle

Caucutt, Elizabeth M. ; Ghosh, Mrinal G ; Kelton, Christina M L. / Durability versus concentration as an explanation for price inflexibility. In: Review of Industrial Organization. 1999 ; Vol. 14, No. 1. pp. 27-50.
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