2min chapter

Odd Lots cover image

Isabella Weber on the Big Rethink of Inflation

Odd Lots

CHAPTER

The Role of Legitimacy in Pricing Behavior

In normal times, there are basically two things that vote constrain firms in their pricing behavior. One is fear of losing market shares to competitors; the other is fearing customers won't pay these prices. But when price hikes start to be more or less coordinated due to emergency situations, then those constraints go away. This kind of coordination can happen on a sectoral global level and it's called excuseflation.

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