Buyer-Size Discounts and Inflation Dynamics
This paper considers the macroeconomic effects of retailers' market concentra- tion and buyer-size discounts on inflation dynamics. During Japan's "lost decades," large retailers enhanced their market power, leading to increased exploitation of buyer-size discounts in procuring goods. We incorporate this effect into an other- wise standard New-Keynesian model. Calibrating to the Japanese economy during the lost decades, we find that despite a reduction in procurement cost, strength- ened buyer-size discounts did not cause deflation; rather, they caused inflation of 0.1% annually. This arose from an increase in the real wage due to the expansion of production.
Year of publication: |
2014-01
|
---|---|
Authors: | Ojima, Mayumi ; Shino, Junnosuke ; Ueda, Kozo |
Institutions: | Faculty of Economics, University of Tokyo |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Buyer-Size Discounts and Inflation Dynamics
Ojima, Mayumi,
-
Buyer-Size Discounts and Inflation Dynamics
Ojima, Mayumi, (2014)
-
Retailer market concentration, buyer-size discounts and inflation dynamics
Ojima, Mayumi, (2018)
- More ...