Psychological price barriers, El Niño, La Niña: New insights for the case of coffee

Mark J. Holmes; Jesús Otero

doi:10.1016/j.jcomm.2023.100350

Psychological price barriers, El Niño, La Niña: New insights for the case of coffee

Mark J. Holmes
, Jesús Otero

Research output: Contribution to Journal › Research Article › peer-review

1 Scopus citations

Abstract

This paper investigates the possibility of psychological barriers in the price dynamics of seven types of coffee varieties over a twenty-year period. When prices are expressed in hundreds of cents, barriers surrounding the round number prices ending in 00 are confirmed for the high quality coffees. The dynamics of coffee price returns differ before and after breaches of hypothesised barriers. Using a novel model selection method based on multiple testing, there is further confirmation of price barriers insofar as positive and negative climate anomalies affect coffee price proximity to barriers.

Original language	English (US)
Article number	100350
Journal	Journal of Commodity Markets
Volume	31
DOIs	https://doi.org/10.1016/j.jcomm.2023.100350
State	Published - Jan 2023

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 10 Reduced Inequalities

All Science Journal Classification (ASJC) codes

Finance
Economics and Econometrics

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10.1016/j.jcomm.2023.100350

Cite this

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abstract = "This paper investigates the possibility of psychological barriers in the price dynamics of seven types of coffee varieties over a twenty-year period. When prices are expressed in hundreds of cents, barriers surrounding the round number prices ending in 00 are confirmed for the high quality coffees. The dynamics of coffee price returns differ before and after breaches of hypothesised barriers. Using a novel model selection method based on multiple testing, there is further confirmation of price barriers insofar as positive and negative climate anomalies affect coffee price proximity to barriers.",

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AB - This paper investigates the possibility of psychological barriers in the price dynamics of seven types of coffee varieties over a twenty-year period. When prices are expressed in hundreds of cents, barriers surrounding the round number prices ending in 00 are confirmed for the high quality coffees. The dynamics of coffee price returns differ before and after breaches of hypothesised barriers. Using a novel model selection method based on multiple testing, there is further confirmation of price barriers insofar as positive and negative climate anomalies affect coffee price proximity to barriers.

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Psychological price barriers, El Niño, La Niña: New insights for the case of coffee

Abstract

UN SDGs

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