3 Lessons from hyperinflationary periods

Bergen, Mark and Bergen, Thomas and Levy, Daniel and Semenov, Rose (2022): 3 Lessons from hyperinflationary periods. Forthcoming in: Harvard Business Review

Abstract

Inflation is painful, for firms, customers, employees, and society. But careful study of periods of hyperinflation point to ways that firms can adapt. In particular, companies need to think about how to change prices regularly and cheaply — because constant price changes can ultimately be very, very expensive. And they should consider how to communicate those price changes to customers. Providing clarity and predictability can increase consumer trust and help firms in the long run.

• Item Type: MPRA Paper
• Language: English
• Keywords: inflation; hyperinflation; pricing; price setting; price adjustment; menu cost; cost of price adjustment; implicit contract; long-term relationship
• Subjects: E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E31 - Price Level ; Inflation ; Deflation; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L16 - Industrial Organization and Macroeconomics: Industrial Structure and Structural Change ; Industrial Price Indices; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M3 - Marketing and Advertising > M30 - General

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