We ran a field experiment in a Dutch retail chain consisting of 128 stores. In a random sample of these stores, we introduced short-term sales competitions among subsets of stores. We find that sales competitions have a large effect on sales growth, but only in stores where the store's manager...

New Empirical Evidence on Price Setting and Consumer Behaviour in the Retailing Sector. There are two objectives of this article: (i) It is discussed theoretically how the dynamics of pricing decisions of multiproduct retailers can be explained. (ii) It is analyzed empirically by use of scanner...

Price promotions play a prominent role in German grocery retailing. Their purpose is to increase store traffic and strengthen customer loyalty. It is hypothesized that other marketing tools, like psychological pricing can add to the positive impact of price promotions on sales. Thus, we...

German food retailing is characterized by a strong price competition. Thus, we would expect the law of one price to hold and price adjustments to occur simultaneously. However, significant price differences can be observed which are often caused by sales. As price promotions are not related to...

In diesem Beitrag wird ein Modell entwickelt, das die Wirkungen von Preis- und Nicht-Preis-Promotions auf die Markenloyalität von Konsumenten abbildet. Die Markenloyalitäts-Varia-ble von Guadagni/Little (1983) wird dabei dahingehend erweitert, daß die Änderung der Markenloyalität nach einem...

We analyse retailer and household behaviour on the Norwegian electricity market, based on detailed information on prices and other market characteristics. We find that there exists a competitive market segment where a number of retailers compete fiercely for customers, with small margins on all...

In the context of an infinitely repeated capacity-constrained price game, we endogenize the composition of a cartel when .rms are heterogeneous in their capacities. When .rms are sufficiently patient, there exists a stable cartel involving the largest .rms. A .rm with sufficiently small capacity...

Kryvtsov and Midrigan (2008) study the behavior of inventories in an economy with menu costs, fixed ordering costs and the possibility of stock-outs. This paper extends their analysis to a richer setting that is capable of more closely accounting for the dynamics of the US business cycle. We...

Recent New Keynesian models of macroeconomy view nominal cost rigidities, rather than nominal price rigidities, as the key feature that accounts for the observed persistence in output and inflation. Kryvtsov and Midrigan (2010a,b) reassess these conclusions by combining a theory based on nominal...

How do firms adjust prices in the marketplace? Do they tend to adjust prices infrequently in response to changes in market conditions? If so, why? These remain key questions in macroeconomics, particularly for central banks that work to keep inflation low and stable. The authors use the Bank of...