Five years after the euro changeover - How long does it take to learn prices?

As expected, immediately after the changeover to the euro, consumer price knowledge in Finland was clearly weaker than in the era of the Finnish mark. However, a surprising result of our study was that this weakening was not only an initial and short-term shock caused by the new currency. Consumer price knowledge has not improved significantly in five years. It looks probable that the reason for the decreased price knowledge is the change in nominal values. Earlier literature has shown the relevance of nominal values in the market. The results of our study indicate that nominal measures have a strong impact on how consumers estimate prices and, therefore, on how they learn prices.