Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/127335
Authors: 
Eife, Thomas A.
Year of Publication: 
2011
Series/Report no.: 
Discussion Paper Series, University of Heidelberg, Department of Economics 518
Abstract: 
This paper studies the long-run effect of the 2002 changeover on restaurant prices in Germany. German restaurant prices increased significantly when the euro was introduced as a new currency but rather than returning to their re-changeover trend, restaurant prices appear to have stabilized on a higher path. This stands in contrast to the prediction of menu costs models or models of confusion-induced price increases as these models can only account for a transitory effect. The persistence of the increase suggests the existence of more than one price equilibrium. This multiplicity of price equilibria is a central part of the explanation proposed in the paper.
JEL: 
D43
E31
L13
L89
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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