Sticky Prices

Price stickiness, or sticky prices, is the resistance of market price(s) to change the price, despite changes in input cost or demand patterns. “Sticky” is a general economics term that can apply to any financial variable that is resistant to change. When applied to prices, it means that the sellers (or buyers) of certain goods are reluctant to change.

Price stickiness would occur, for instance, if the price of a once-in-demand smartphone remains high at say $800 even when demand drops significantly.