We propose a simple explanation for price rigidity in perishable groceries: inventory record inaccuracy (IRI). We build our argument in two steps. First, we tailor Gallego and Van Ryzin’s (1994) revenue management model to perishable groceries by adding an inventory waste process,...

The Thanksgiving-Christmas holiday period is a major sales period for US retailers. Due to higher store traffic, tasks such as restocking shelves, handling customers' questions and inquiries, running cash registers, cleaning, and bagging, become more urgent during holidays. As a result, the...

In this paper, we examine the role of inventory in the price-setting behavior of a distributive firm. Empirically, we show that probability of price change has a positive relation to the scale of the retailer's storage and the frequency of its bargain sales. We also show a negative relation...