Barometric Price Leader Model:

In this model, it is formally or informally agreed that all firms will follow the changes of the price of a firm, which is considered to have a good knowledge of the prevailing conditions in the market and can forecast better than the others on the future developments in the market. The firm chosen as the leader is considered as the barometer, reflecting the changes in economic environment. The barometric firm may be neither a low-cost nor a large firm.

Usually it is a firm, which from past behaviour has established the reputation of a good forecaster of economic changes.