The Transmission Medium of Rumors, and How Does it Affect Stockpiling and Price Hikes for Consumer Goods

Abstract

This study’s central theme is determining the effect of stockpiling on price hikes. Additionally, the media through which rumors are spread and which medium has a more significant influence on encouraging excessive purchasing, known as stockpiling. Stratified random sampling was utilized to get data from 200 participants. The data were analyzed using the partial least squares-structural equation modeling (PLS-SEM) approach with the assistance of Smart PLS 4.1.0.0. This unique work examines the correlation between stockpiling and price increases. The study revealed that stockpiling leads to price increases, mainly when prompted by rumors spread through social media and word-of-mouth (WoM) communication. Social media has a more significant influence on stockpiling compared to word-of-mouth communication. This study’s findings offer a precise insight into how rumors systematically impact price hikes. The message explicitly advises buyers from participating in panic buying without verifying information. This study examines the effect of stockpiling on price increases while also recognizing the possible reciprocal impact of price increases on stockpiling. Additional research can be pursued on the subject.