Exchange rates and European countries’ export prices: An empirical test for asymmetries in pricing to market behavior

Gil‐Pareja, Salvador

doi:10.1007/bf02707394

Cited by 29 publications

(22 citation statements)

References 16 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…This latter result is line with the market share explanation. It is important to note that similar mixed result was pointed out by a number of empirical studies (Gil-Pareja, 2000, andCoughlin andPollard, 2004). Next, we check the asymmetry of pass-through with respect exchange rate magnitude.…”

Section: Resultssupporting

confidence: 61%

“…Nevertheless, our findings corroborate with previous empirical studies which provide also no clear evidence on the direction of asymmetry in ERPT. For a set of European industries, Gil-Pareja (2000) found that the direction of the asymmetry varied across industries and countries. Coughlin and Pollard (2004) confirm the same results in their study on 30 U.S. industries.…”

Section: Results From Lstr Modelmentioning

confidence: 99%

“…On one hand, asymmetric behavior can arise from the direction of exchange rate changes i.e., in response to currency depreciations and appreciations (see e.g. Gil-Pareja, 2000). On the other hand, the extent of pass-through may also respond asymmetrically to the magnitude of exchange rate movements, since there is a differential effect of large versus small exchange rate changes (see e.g.…”

Section: Why Erpt Would Be Asymmetric?mentioning

confidence: 99%

“…In some cases the pass-through associated with depreciations exceeded appreciations; however, in other cases, this result is rather the opposite. Gil-Pareja (2000) analyzed the differences in pass-through in a set of industries across a sample of European countries. He found that the direction of asymmetry varied across industries and countries.…”

Section: Why Erpt Would Be Asymmetric?mentioning

confidence: 99%

See 3 more Smart Citations

Asymmetric Exchange Rate Pass-Through in the Euro Area: New Evidence from Smooth Transition Models

Cheikh

2012

Economics

View full text Add to dashboard Cite

This paper examines the presence of asymmetric behavior in exchange rate passthrough (ERPT) to CPI inflation in 12 euro area (EA) countries. Using a class of nonlinear smooth transition models, the author tests for asymmetry with respect to the direction and the magnitude of exchange rate changes. On the one hand, the author finds only 5 out of 12 EA countries showing asymmetric pass-through related to exchange rate appreciations and depreciations. Results are somewhat mixed with no clear evidence about the direction of asymmetry. On the other hand, the author reports strong evidence that ERPT responds asymmetrically to the size of exchange rate changes as a result of presence of menu costs. The degree of ERPT is found to be higher for large exchange rate changes than for small ones in 9 out of 12 EA countries. JEL C22, E31, F31, F41

show abstract

Section: Resultssupporting

confidence: 61%

Section: Results From Lstr Modelmentioning

confidence: 99%

Section: Why Erpt Would Be Asymmetric?mentioning

confidence: 99%

Section: Why Erpt Would Be Asymmetric?mentioning

confidence: 99%

See 2 more Smart Citations

Asymmetric Exchange Rate Pass-Through in the Euro Area: New Evidence from Smooth Transition Models

Cheikh

2012

Economics

View full text Add to dashboard Cite

show abstract

“…2 The literature on exchange rate pass-through, in turn, reports several sources of nonlinearity, indicating that the degree of pass-through can be related to some macroeconomic variable, including the exchange rate. Mann (1986), Goldberg (1995), Gil-Pareja (2000), Mahdavi (2002) and Olivei (2002) have found asymmetric pass-through related to the direction of exchange rate changes, while Ohno (1989) and Pollard and Coughlin (2004) have indicated the presence of asymmetry associated with the magnitude of exchange rate changes.…”

Section: Introductionmentioning

confidence: 99%

Nonlinear mechanisms of the exchange rate pass-through: a Phillips curve model with threshold for Brazil

Correa¹,

Minella²

2010

Rev. Bras. Econ.

View full text Add to dashboard Cite

ContentsThis paper investigates the presence of nonlinear mechanisms of pass-through from the exchange rate to inflation in Brazil. In particular, it estimates a Phillips curve with a threshold for the pass-through. The paper examines whether the short-run magnitude of the pass-through is affected by the business cycle, direction and magnitude of exchange rate changes, and exchange rate volatility. The results indicate that the short-run pass-through is higher when the economy is growing faster, when the exchange rate depreciates above some threshold and when exchange rate volatility is lower. Este trabalho investiga a presença de mecanismos não-lineares de

show abstract

Gravity Models and Asymmetric Exchange Rate Effects: Insights from German Beer Exports

Dreyer

Fedoseeva

2016

Agribusiness

View full text Add to dashboard Cite

Recent developments in trade literature suggest that in the presence of strategic pricing in some markets and an incomplete exchange rate pass-through resulting from it, the standard gravity model has to be augmented with an exchange rate variable. As symmetry of pass-through has been questioned in new pricing-to-market (PTM) studies, we argue that this asymmetric impact of the exchange rate on trade should be explicitly modeled within the gravity framework. This consideration of asymmetric effects of exchange rate appreciations and depreciations on export values and quantities might provide insights into the driving forces of PTM in a particular market (or group of markets) given that the existing literature emphasizes two main hypotheses that explain the occurrence of an asymmetric PTM (market share hypothesis and marketing bottleneck hypothesis). In this paper, we propose a way to integrate individual (asymmetric) long-run effects of currency appreciations and depreciations on trade flows into the gravity model and empirically investigate which of the driving forces is relevant for the case of German beer exports. PTM studies often argue that the market share protection is a reason for local currency price stabilization mechanisms applied in the most important markets. Yet, the results of our analysis reveal that this might no longer be the case when all trading partners are considered. [EconLit citations: C33; F14; L66]. C 2016 Wiley Periodicals, Inc.

show abstract

Exchange rates and European countries’ export prices: An empirical test for asymmetries in pricing to market behavior

Abstract: F12, F14,

Cited by 29 publications

References 16 publications

Asymmetric Exchange Rate Pass-Through in the Euro Area: New Evidence from Smooth Transition Models

Asymmetric Exchange Rate Pass-Through in the Euro Area: New Evidence from Smooth Transition Models

Nonlinear mechanisms of the exchange rate pass-through: a Phillips curve model with threshold for Brazil

Gravity Models and Asymmetric Exchange Rate Effects: Insights from German Beer Exports

Contact Info

Product

Resources

About