We reconsider the New Keynesian model with staggered price setting when each market is characterized by a small number of firms competing in prices à la Bertrand rather than a continuum of isolated monopolists. Price adjusters change their prices less when there are more firms that do not...

This paper demonstrates that retail-level real rigidity is both quantitatively important and consistent with facts on retail pricing. Rich retailer scanner data from NielsenIQ reveals that 1) product demand is lower when prices for other goods in the same store are higher and 2) overall...

We study a firm's optimal pricing policy under price commitment. The firm's objective is to maximize its long-term average revenue given a steady arrival of strategic customers. In particular, customers arrive over time, are strategic in timing their purchases and are heterogeneous along two...