Abstract
Exchange Rates and European Countries’ Export Prices: An Empirical Test for Asymmetries in Pricing to Market Behavior. — This paper uses forward instead of spot exchange rates to test for the presence of asymmetries in the response of export prices to exchange rate movements on a wide sample of European Union exporter countries and highly disaggregated product categories. In most cases, the data give support to the hypothesis of a symmetric pricing to market behavior during periods of depreciation and appreciation of the exporter’s currency.
Zusammenfassung
Wechselkurse und Exportpreise europÄischer LÄnder: Ein empirischer Test von Asymmetrien in der Preispolitik der Exporteure. — In diesem Aufsatz wird getestet, ob Exporteure ihre Preise nach einer Aufwertung anders setzen als nach einer Abwertung, sich also nach WechselkursÄnderungen asymmetrisch verhalten. Hierfür werden Devisenterminkurse statt Devisenkassakurse benutzt und auf eine gro\e Stichprobe von ExportlÄndern der EuropÄischen Union und stark disaggregierte Produktkategorien angewendet. In den meisten FÄllen unterstützen die Daten die Hypothese eines symmetrischen Preisverhaltens sowohl wÄhrend einer Abwertung als auch wÄhrend einer Aufwertung der WÄhrung des Exportlandes.
Similar content being viewed by others
References
Athukorala, P. (1991). Exchange Rate Pass-Through: The Case of Korean Exports of Manufactures.Economics Letters 35(1): 79–84.
Athukorala, P., and J. Menon (1994). Pricing to Market Behaviour and Exchange Rate Pass-Through in Japanese Exports.Economic Journal 104(March): 271–281.
European Commission (1998). Currency Management Cost.The Single Market Review. Subseries III, Volume 6, Brussels.
Feenstra, R. C., and J. D. Kendall (1997). Pass-Through of Exchange Rates and Purchasing Power Parity.Journal of International Economics 43 (1): 237–261.
Gagnon, J. E., and M. M. Knetter (1995). Markup Adjustment and Exchange Rate Fluctuations: Evidence from Panel Data on Automobile Exports.Journal of International Money and Finance 14 (2): 289–310.
Gil, S. (1998). Export Price Discrimination and Exchange Rates: Evidence from European Union Member States Exports to OCDE Countries. Unpublished manuscript. University of Valencia, January 1998.
Goldberg, P. K. (1995). Product Differentiation and Oligopoly in International Markets: The Case of the U.S. Automobile Industry.Econometrica 63 (4): 891–951.
Goldberg, P. K., and M. M. Knetter (1997). Goods Prices and Exchange Rates: What Have We Learned?Journal of Economic Literature 35(3): 1243–1272.
Han, S. S., and S. H. Suh (1995). Exchange Rate Pass-Through and the J-Curve: An Analysis of the Korean Case.Journal of Policy Modelling 18(1):69–86.
Kadiyali, C. (1997). Exchange Rate Pass-Through for Strategic Pricing and Advertising: An Empirical Analysis of the U.S. Photographic Film Industry.Journal of International Economics 43 (3/4): 437–461.
Khosla, A. (1991). Exchange Rate Pass-Through and Export Pricing. Evidence from the Japanese Economy.Journal of the Japanese and International Economics 5(1): 41–59.
Knetter, M. M. (1989). Price Discrimination by U.S. and German Exporters.American Economic Review 79(1): 198–210.
— (1993). International Comparisons of Pricing-to-Market Behavior.American Economic Review 83 (3):473–486.
— (1994). Is Export Price Adjustment Asymmetric? Evaluating the Market Share and Marketing Bottlenecks Hypotheses.Journal of International Money and Finance 13(1): 55–70.
— (1995). Pricing to Market in Response to Unobservable and Observable Shocks.International Economic Journal 9(2): 1–25.
Krugman, P. R. (1987). Pricing to Market when the Exchange Rate Changes. In S. W. Arndt and J. D. Richardson (eds.),Real-Financial Linkages Among Open Economies. Cambridge, Mass.: MIT Press.
Lawrence, R. (1990). U.S. Current Account Adjustment: An Appraisal.Brookings Papers on Economic Activity (2): 343–383.
Lee, J. (1995). Pricing to Market in Korean Manufacturing Exports.International Economic Journal 9(4): 1–12.
Mann, C. L. (1986). Prices, Profit Margins and Exchange Rates.Federal Reserve Bulletin 72(6):366–379.
Marston, R. C. (1990). Pricing to Market in Japanese Manufacturing.Journal of International Economics 29(3/4): 217–236.
Menon, J. (1995). Exchange Rate Pass-Through.Journal of Economic Surveys 9(2): 197–231.
Ohno, K. (1989). Export Pricing Behavior of Manufacturing: A U.S.-Japan Comparison.International Monetary Fund Staff Papers 36(3):550–579.
Yang, J. (1995). Exchange Rate Pass-Through in the U.S. Market: A Cross-Country and Cross-Product Investigation.International Review of Economics and Finance 4(4): 353–371.