This paper provides an alternative theory of price adjustment resting on consumer loss aversion in the price dimension …. In line with prospect theory the perceived losses from price increases are weighted stronger in the consumer s utility … function than the perceived gains resulting from price decreases of equal magnitude. Prices are evaluated relative to a certain …

prices below those expected in second price auctions. Our proposed extension of the model results not only in a better fit of … according to this information in the direction predicted by the model. They increase their BIN price when facing a population of …

bank. We develop a sticky price model where money serves as the means of payment and ex-ante identical agents borrow …