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Peter Levell
@peterlevell.bsky.social
Economist. Associate Director at the Institute for Fiscal Studies @theifs.bsky.social.
509 followers293 following23 posts
PLpeterlevell.bsky.social

7/ If we split products into different 10 levels of “quality” (assuming cheaper products are not as nice as more expensive ones), we see that products in the bottom quality rung saw price increase of 36% compared to 16% for the top quality rung.

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PLpeterlevell.bsky.social

8/ Why might this be? One explanation is that cheaper varieties tend to be associated with lower profit margins giving less scope for suppliers to absorb rising energy prices and labour costs. This would be consistent with the evidence.

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PL
Peter Levell
@peterlevell.bsky.social
Economist. Associate Director at the Institute for Fiscal Studies @theifs.bsky.social.
509 followers293 following23 posts