Work

Is export price adjustment asymmetric?: evaluating the market share and marketing bottlenecks hypotheses

Year: 1994

Type: article

Abstract: Export price adjustment is asymmetric with respect to currency fluctuations in at least two circumstances. If firms face capacity constraints in distribution networks or quantitative trade restrictions, then pricing-to-market may be greater during depreciations of the exporter's currency. If firms attempt to build market share subject to the threat of trade restrictions, then pricing-to-market may be greater during appreciations of the exporter's currency. This paper tests for asymmetries using panel data on German and Japanese 7-digit industry exports. The data seldom reject the hypothesis of a symmetric response of prices to exchange rates.

Source: Journal of International Money and Finance

DOI: 10.1016/0261-5606(94)90024-8

Author: Michael M. Knetter

Institutions: Dartmouth College, National Bureau of Economic Research

Language: English

Topic: Global trade and economics

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $3,130

Funder: Dartmouth College