Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/315164 
Year of Publication: 
2025
Series/Report no.: 
Working Paper No. 2025-01
Publisher: 
Bar-Ilan University, Department of Economics, Ramat-Gan
Abstract: 
When and under what circumstances might people interpret a price increase as fair and acceptable is an important question in behavioral economics. We report the results of surveys we conducted in the US and Israel in 2020, a time when many prices increased following the spread of the COVID-19 pandemic. To assess respondents' fairness perceptions of price increases, we focus on goods whose prices have increased during the pandemic, including some essential goods. Consistent with the principle of dual entitlement, we find that respondents perceive price increases as fairer if they are due to cost shocks than if they are due to demand shocks. However, we also find large differences across the two populations, as well as across goods.
Subjects: 
Dual Entitlement
Fairness Perceptions
Consumer Antagonism
COVID-19
Pandemic
Price Level
Price Adjustment
Price Increase
Price Rigidity
Sticky Prices
JEL: 
E70
E31
D90
M31
Document Type: 
Working Paper

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