This article uses Meta-Regression Analysis (MRA) to investigate exchange rate pass-through to domestic prices, highlighting differences between transition and developed economies. A total of 23 studies yielded 575 coefficients measuring exchange rate pass-through to import prices and consumer prices for 23 developed and 12 transition economies. The MRA results confirm the finding of many particular analyses that exchange rate pass-through is less than complete. In addition, exchange rate pass-through is higher to import prices than to consumer prices; and exchange rate pass-through is higher in the long run than in the short run. Regarding transition and developed economies, MRA suggests that there is no statistically significant difference in exchange rate pass-through to import prices. Yet, exchange rate pass-through to consumer prices is significantly and substantially higher in transition than in developed economies. This finding is consistent with the caution of many monetary authorities in transition economies regarding exchange rate flexibility.
In this paper we investigate if tariffs affect manufacturing value added in 25 countries from Central and Southeast Europe, the Commonwealth of Independent States and Middle East and North Africa over the period1990-2010. We use an instrumental variable approach, with the World Trade Organization bound tariff and the lagged tariff as instruments. Results suggest that, in general, lower tariffs seem to lead to higher value added, through the higher imports of inputs in the production process which were either inexistent or more expensive on the domestic market previously. The effect is not driven by the World Trade Organization membership, but by individual countries' decision to lower their tariffs. However, there are notable differences in the effects between different groups of countries and industries: tariffs are not found to affect industrialization in Southeast Europe and Middle East and North Africa, which implies that their decision to liberalize trade was likely premature. This is supported by the finding that lower tariffs have positive effects on industry value added only in industries with higher value added (i.e. more mature industries).
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