While profit maximisation is clearly defined in theoretical models, in practice producers selling their goods and services can find it hard to measure the price sensitivity of customer demand. While marketing departments often rely on aggregated data to analyse the interlinkages between selling...

This paper uses regular business surveys of UK activity to gauge price flexibility. These imply an average price duration of two to three quarters, and this is stable across sectors. Strict time-dependent pricing does not hold over the long run, and there is evidence that firms introduce some...