The Review of Economics and Statistics Vol. 93 No. 3 2011
Convenient Prices and Price Rigidity: Cross-Sectional Evidence
Abstract
This paper provides cross‐sectional evidence of convenient prices—prices that simplify and expedite transactions, reducing the time costs from physically making a transaction. Firms may wish to set convenient prices for items that are typically purchased with cash, are sold alone or with a few similar items, and are high‐traffic transactions, that is, that require queuing or are frequently purchased. I collect a new data set and find broad support for the use of convenient prices in locations where making a rapid transaction is important. Convenience also appears to predominantly affect goods and services with above‐average price rigidity.
- DOI
- 10.1162/rest_a_00124
- Volume
- 93
- Issue
- 3
- Pages
- 1076-1086
- Language
- en
- Sources
- openalex crossref