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A Sticky-Price View of Hoarding / Christopher Hansman, Harrison Hong, Áureo de Paula, Vishal Singh.
- Format:
- Book
- Author/Creator:
- Hansman, Christopher.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w27051.
- NBER working paper series no. w27051
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2020.
- Summary:
- We show that sticky prices exacerbate household hoarding of storable goods. When stores are slow to adjust prices following a cost shock, households have an incentive to stockpile just as in a typical retail sale. This incentive is present even in the absence of traditional panic or precautionary motives for hoarding. Using detailed US supermarket scanner data covering the 2008 global rice crisis--a shock triggered by an Indian rice export ban--we find that household hoarding anticipated retail price adjustments. We construct forecast tests relating the cross-section of product or store-level price adjustments to the expectations implied by consumer purchases. Bias and efficiency tests reject panic/precautionary motives in favor of a sticky-price view.
- Notes:
- Print version record
- April 2020.
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