The Euro Changeover and the Factors Influencing Perceived Inflation

The most flamboyant economic effect of the euro changeover on consumers was a dramatic increase in perceived inflation. To directly measure perceived inflation, Brachinger developed a new index of perceived inflation (IPI). This index is based on some hypotheses about factors influencing perceived i...

Full description

Saved in:
Bibliographic Details
Published in:Journal of consumer policy 2007-12, Vol.30 (4), p.405-419
Main Authors: Brachinger, Hans Wolfgang, Zacharias, Elisabeth, Belting, Julia, Jungermann, Helmut, Grinberg, Katarzyna
Format: Article
Language:English
Subjects:
C43
Consumer behavior
Consumer behaviour
Consumer Price Index
Consumers
Consumption
Currencies
Currency
D81
E31
Euro
Europe
Eurozone
Hypotheses
Index of perceived inflation (IPI)
Inflation
Inflation rates
Loss aversion
Monetary policy
Perceived inflation
Perception
Perceptions
Price increases
Price levels
Purchase frequency
Studies
Time series
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:The most flamboyant economic effect of the euro changeover on consumers was a dramatic increase in perceived inflation. To directly measure perceived inflation, Brachinger developed a new index of perceived inflation (IPI). This index is based on some hypotheses about factors influencing perceived inflation. An experimental study is presented which investigated the influence of two of these hypothesized factors, purchase frequency and loss aversion, on individual judgments of price changes. Furthermore, two additional factors have been included that are informative with respect to the IPI, product segment and price level. Judgments of inflation were assessed with three methods, yielding different results. Empirical evidence for the hypotheses was obtained. [PUBLICATION ABSTRACT]
ISSN:0168-7034
1573-0700
DOI:10.1007/s10603-007-9051-4