Publications

March–April 2023
Article

Case Study: Should a Dollar Store Raise Prices to Keep Up with Inflation?

By: Jill Avery and Marco Bertini

How should a dollar store maintain its brand and price position in the marketplace in the face of rising inflation? Is holding a $1.00 price point still viable in today's marketplace? In this fictional case, managers face inflationary pressures and must decide whether... View Details

Keywords: Pricing; Pricing Strategy; Retailing; Discount Retailing; Discount Store; Marketing; Marketing Strategy; Brands and Branding; Inflation and Deflation; Retail Industry; United States

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2020
Working Paper

Tariff Passthrough at the Border and at the Store: Evidence from U.S. Trade Policy

By: Alberto Cavallo, Gita Gopinath, Brent Neiman and Jenny Tang

We use micro data collected at the border and the store to characterize the price impact of recent US trade policy on importers, exporters, and consumers. At the border, import tariff passthrough is much higher than exchange rate passthrough. Chinese exporters did not... View Details

Keywords: Trade Policy; Tariffs; Exchange Rate Passthrough; Economics; Trade; Policy; Inflation and Deflation; United States; China

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22 Aug 2024
Research & Ideas

Reading the Financial Crisis Warning Signs: Credit Markets and the 'Red-Zone'

A year ago, most experts thought the US economy was thundering headlong toward recession, as the Federal Reserve moved at a historic pace to slow inflation by bridling interest rates. Yet, despite recent tremors in the stock market, no... View Details

Keywords: by Rachel Layne; Banking

April 2011 (Revised May 2013)
Case

South Africa (A): Stuck in the Middle?

By: Richard H. K. Vietor and Diego Comin

Fifteen years after ending apartheid, formal unemployment in South Africa was still at 24%. While the country had grown at 4 to 5% annually during the 2000s, the financial crisis set it back by 1 million more unemployed. Moreover, it seemed as if the nation were stuck... View Details

Keywords: Financial Crisis; Inflation and Deflation; Policy; Employment; Wages; Competition; South Africa

April 1997 (Revised February 2001)
Case

Mexico in Debt

By: Richard H.K. Vietor and Eilene Zimmerman

Describes Mexico's political and economic system in the 1960s and 1970s. Focuses on: 1) the causes of the debt crisis in 1982; 2) elements of President de la Madrid's restructuring efforts between 1982-88; President Salinas's attempts to complete restructuring and... View Details

Keywords: Restructuring; Economic Systems; Financial Crisis; Inflation and Deflation; Macroeconomics; Borrowing and Debt; Government and Politics; Mexico

March 2024 (Revised March 2025)
Case

Pakistan at 75: When Will the 'Nazuk Mor' End?

By: Meg Rithmire, Salaar A. Shaikh and Hong Zhang

In 2023, business leaders, politicians, and civil society were all describing Pakistan’s condition as “polycrisis.” The country faced decisions on elections after Imran Khan’s ouster and arrest, protests against the military’s involvement in politics and the crackdowns... View Details

Keywords: Developing Countries and Economies; Financial Crisis; Inflation and Deflation; Government and Politics; Health Pandemics; Conflict and Resolution; Pakistan

11 Oct 2016
First Look

October 11, 2016

Wenxin, and Jesse Schreger Abstract—Nominal debt provides consumption-smoothing benefits if it can be inflated away during recessions. However, we document empirically that countries with more countercyclical inflation, where nominal debt... View Details

Keywords: Sean Silverthorne

June 2002 (Revised March 2003)
Case

Bolivia: Globalization, Sovereignty, or Democracy?

By: Rafael M. Di Tella, Huw Pill, Miguel Lopez de Silanes Gomez, Cinthia Fernholz Violand and Ingrid Vogel

Describes the economic stabilization program implemented by the Bolivian government in 1985 to 1986 and its impact on the development process in Bolivia. View Details

Keywords: History; Programs; Development Economics; Inflation and Deflation; Globalization; Government and Politics; Bolivia

13 Feb 2007
First Look

First Look: February 13, 2007

minds to wander were correlated with activity in this network. The Persistence of Inflation versus that of Real Marginal Cost in the New Keynesian Model Author:Julio J. Rotemberg Periodical:Journal of Money, Credit, and Banking... View Details

Keywords: Martha Lagace

08 Mar 2016
Research & Ideas

Solving an Economic Mystery Surrounding Argentina and Chile

Argentina, multiple business leaders explained how they were obliged to adopt a short-term decision horizon in response to policy fluctuations, macroeconomic instability and high inflation rates. “Volatility,” one business leader noted,... View Details

Keywords: by Sean Silverthorne

2009
Chapter

Behavioral Aspects of Price Setting, and Their Policy Implications

By: Julio J. Rotemberg

This paper starts by discussing consumers' cognitive and emotional reaction to posted prices. Cognitively, some consumers do not appear to make effective use of price information to maximize their consumption-based utility. Emotionally, prices can induce regret and... View Details

Keywords: Inflation and Deflation; Price; Policy; Laws and Statutes; Demand and Consumers; Business and Government Relations

05 Aug 2024
Research & Ideas

Watching for the Next Economic Downturn? Follow Corporate Debt

information about the risk of future economic crashes and deserve more scrutiny from policymakers, economists, and regulators. The paper emerges after years of persistent inflation and mounting interest rates, and amid close scrutiny of... View Details

Keywords: by Rachel Layne

10 Jul 2000
Research & Ideas

The State of the Markets

the Internet," he concluded. "This will favor the cheapest suppliers and keenest buyers and thus hold down prices and inflation while raising productivity." Ever-changing Demands In his remarks, the NYSE's Cochrane... View Details

Keywords: by James E. Aisner

23 Aug 2004
Research & Ideas

New Challenges for Long-Term Investors

of time, the safe strategy is to invest in long-term coupon bonds (or annuities), not cash. There is catch with this, though. Standard annuities and Treasury bonds pay fixed coupons, and inflation can seriously erode the purchasing power... View Details

Keywords: by Ann Cullen

23 Mar 2015
Research & Ideas

It’s Called ‘Price Coherence,’ and It’s Surprisingly Bad for Consumers

optional for a transaction, including travel booking networks, restaurant ordering services, online rebate services, and some kinds of insurance. Overall, the researchers find that price coherence actually leads to inflated retail prices,... View Details

Keywords: by Carmen Nobel; Retail; Air Transportation; Food & Beverage; Entertainment & Recreation

August 2010 (Revised November 2010)
Supplement

Cosmeticos de Espana, S.A. (C)

By: David F. Hawkins

The third case in the Cosmeticos de Espana case series. What should management's accounting response be to a further devaluation of the Bolivar? View Details

Keywords: Financial Statements; Decision Choices and Conditions; Inflation and Deflation; Currency Exchange Rate; Beauty and Cosmetics Industry; Spain; Venezuela