The Inflationary Consequences of a Currency Changeover on the Catering Sector: Evidence from the Michelin Red Guide

23 Pages Posted: 19 Jan 2009

See all articles by Fabrizio Adriani

Fabrizio Adriani

SOAS University of London

Giancarlo Marini

University of Rome Tor Vergata - Faculty of Economics

Pasquale Scaramozzino

University of Rome II - Faculty of Economics; University of London - School of Oriental and African Studies (SOAS); University of London - Centre for Financial and Management Studies (CeFIMS)

Date Written: 0000

Abstract

This paper examines the inflationary consequences of a currency changeover in the catering market. Empirical evidence from the Michelin Red Guide shows that: (i) differently from restaurants in non-euro countries, restaurants in the euro area experienced abnormal price increases just after the changeover; and (ii) among restaurants in the euro area, tourist restaurants are responsible for most of the abnormal price increases. These results suggest that proposed explanations for the changeover effect, such as menu adjustment and rounding up, are only part of the story. We present a simple model of the catering market that is consistent with the evidence.

Suggested Citation

Adriani, Fabrizio and Marini, Giancarlo and Scaramozzino, Pasquale, The Inflationary Consequences of a Currency Changeover on the Catering Sector: Evidence from the Michelin Red Guide (0000). Oxford Bulletin of Economics and Statistics, Vol. 71, Issue 1, pp. 111-133, February 2009, Available at SSRN: https://ssrn.com/abstract=1329784 or http://dx.doi.org/10.1111/j.1468-0084.2008.00521.x

Fabrizio Adriani

SOAS University of London ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

Giancarlo Marini

University of Rome Tor Vergata - Faculty of Economics ( email )

Via Columbia n.2
Rome, 00100
Italy

Pasquale Scaramozzino

University of Rome II - Faculty of Economics ( email )

Via Columbia n.2
Rome, 00100
Italy

University of London - School of Oriental and African Studies (SOAS) ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

University of London - Centre for Financial and Management Studies (CeFIMS)

Thornhaugh Street
London, WC1H 0XG
United Kingdom

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