Pricing of Exports and Exchange Rate Uncertainty

Shabtai Donnenfeld and Itzhak Zilcha

International Economic Review, 1991, vol. 32, issue 4, pages 1009-22

Abstract: This paper examines the implications of different pricing-cum-invoicing strategies available to an exporting firm that sells its product in domestic and foreign markets when the exchange rate is uncertain. The firms' decisions are made sequentially. Throughout the decision-making process, the firm receives new information about the distribution of the random exchange rate. The information arrives after output decisions have been made, but before setting prices and allocating sales. The authors state conditions that lead to the dominance of invoicing exports in the importer's currency over the alternative invoicing strategies. Copyright 1991 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Date: 1991
View citations in EconPapers

Downloads: (external link)
http://links.jstor.org/sici?sici=0020-6598%2819911 ... O%3B2-O&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
Working Paper: PRICING OF EXPORTS AND EXCHANGE RATE UNCERTAINTY (1989)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ier:iecrev:v:32:y:1991:i:4:p:1009-22

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0020-6598

Access Statistics for this article

International Economic Review is edited by Kenneth I. Wolpin

More articles in International Economic Review from Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association
Address: 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297
Contact information at EDIRC.
Series data maintained by ().