(Concise) EARIE Exclusive: Can Inflation Make Consumers Less Price-Sensitive?

#ZEWPodcast (Concise) EARIE Exclusive: Can Inflation Make Consumers Less Price-Sensitive?

Whilst one would normally expect higher inflation to lead to steeper falls in prices and greater price sensitivity amongst consumers, a new study on the Austrian dairy market shows the opposite. Rising inflation has led to consumers becoming less price-sensitive. This change in consumer behaviour has enabled companies to increase their prices and profit margins.

In this episode of the ZEW podcast “Wirklich Wirtschaft”, Professor Dr. Bernhard Ganglmair and Professor Alon Eizenberg discuss this topic at the 53rd Annual Conference of the European Association for Research in Industrial Economics (EARIE).