Background: In the wake of recent spikes of inflationary uncertainty, the phenomenon of“greedflation” has emerged. The phenomenon regards the idea of firms exploiting times of inflationary uncertainty to their benefit at the cost of consumer welfare. Building upon scarce previous literature on the subject, this thesis expands upon established models and contributes to new insights into the topic. Purpose: The primary objective was to investigate whether there were indications of Swedish firms exploiting times of increasing inflation uncertainty to enhance their profitability. The thesis wished to find if there is a relationship between inflation uncertainty and both net profit margins and gross margins. By examining the phenomenon of “greedflation” the goal was to extend the empirical findings and contribute with new methodologies to establish new avenues of exploring the subject. Method: The thesis employed a positivistic, deductive research approach together with a quantitative strategy. The data was collected from databases such as “Thompson Refinitiv Eikon”, “Statistics Sweden” and the “Swedish Central Bank”. The statistical approach was to develop panel data regressions, together with a framework to measure “greedflation”, which allowed for statistical analysis of the data cross-sectionally, over time. Conclusion: Findings reveal that the phenomenon of “greedflation” cannot be entirely proved during the entire sample period. However, dwelling into sectoral and subperiod effects, some signs of exploitative behaviour, or “greedflation” can be seen during 2022 and 2023. Additionally, during periods of high inflationary uncertainty, profit margins tended to rise across sectors, hinting at the presence of "greedflation", although inflation was probably influenced by other effects instead of corporate pricing behaviour.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:hj-64353 |
| Date | January 2024 |
| Creators | Kruse, Axel, Nykvist, Samuel |
| Publisher | Jönköping University |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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