Digital Inflation Pass-Through: The Role of Platform Economies in Shaping Urban Consumer Prices
Keywords:
Digital Inflation Pass-Through, Platform Economy, Urban Consumer Prices , Algorithmic Pricing, Digital MarketsAbstract
Purpose: This study examines the role of platform economies in shaping digital inflation pass-through within urban consumer markets. It focuses on how algorithm-based pricing, dynamic service fees, and data-driven interactions introduced by digital platforms influence price transmission mechanisms.
Subjects and Methods: The study adopts a systematic literature review approach, synthesizing empirical and theoretical studies related to inflation transmission, digital pricing strategies, and platform-based market structures. Peer-reviewed journal articles, policy reports, and relevant economic studies were analyzed to identify patterns and mechanisms of inflation pass-through in digital platform environments.
Results: The findings indicate that digital platforms accelerate inflation pass-through by reducing price adjustment rigidities and enabling real-time responses to cost fluctuations. Platform-specific features, such as commission-based revenue models and service fees, contribute to higher final consumer prices, particularly in urban sectors highly dependent on platforms, including ride-hailing and food delivery services. The study also reveals asymmetric inflation transmission across digital sectors and consumer groups, with stronger price effects observed in highly concentrated markets and among digitally dependent consumers. Additionally, the expansion of platform economies increases short-term price volatility, affecting household expenditure stability and consumer welfare in urban areas.
Conclusions: In conclusion, platform economies significantly reshape traditional inflation transmission mechanisms. Integrating digital market dynamics into inflation monitoring and regulatory frameworks is essential to enhance price stability, protect consumers, and support inclusive urban economic development in the digital era.
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