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Pricing Behaviour in Manufacturing Industry

Published online by Cambridge University Press:  26 March 2020

W. A. H. Godley  and
C. Gillion
W. A. H. Godley
Affiliation:
H.M. Treasury
C. Gillion
Affiliation:
National Institute
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Extract

This note analyses the price changes of some 470 manufactured products in five recent years. They were taken as a sample from the price quotations on which the Board of Trade bases its wholesale price index for manufactured products. Since the conclusions for the engineering industry are rather different from those of other industries, the two groups— engineering and non-engineering—are discussed separately. Food, drink and tobacco prices are excluded throughout.

Type
Research Article
Information
National Institute Economic Review , Volume 33 , August 1965 , pp. 43 - 47
Copyright
Copyright © 1965 National Institute of Economic and Social Research

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References

Notes

note (1) page 43 Many food items involve relatively little processing, and so their prices behave more like those of primary commodities. Drink and tobacco price changes are largely determined by tax changes.

note (2) page 43 The ‘price gradients' are the price changes, divided by the time interval between the changes.

note (3) page 43 See W. A. H. Godley and D. A. Rowe, ‘Retail and consumer prices, 1955-1963’, National Institute Economic Review No. 30, November 1964, page 44; and also R. R. Neild, Pricing and Employment in the Trade Cycle, N.I.E.S.R. Occasional Paper No. 21, Cambridge University Press, 1963.

note (4) page 43 W. A. H. Godley and C. Gillion, ‘Pricing behaviour in the engineering industry’, National Institute Economic Review No. 28, May 1964, page 50.

note (1) page 45 The fact that the data analysed related essentially to price changes meant that in a raw state items whose prices changed frequently were over-represented compared with those whose prices changed seldom. This bias has been corrected in analysing the frequency distributions both of price gradients and of intervals between price changes by the method described in the Appendix.

note (1) page 45 See footnote (1) on previous page.

note (2) page 46 The median time intervals were 7.6 months for rising, and 8.4 months for falling gradients.

note (1) page 47 W. A. H. Godley and C. Gillion, ‘Pricing behaviour in the engineering industry’, National Institute Economic Review No. 28, May 1964, page 50.