Bilateral Invoicing Currency, Value-Added in Imports, and Exchange Rate Pass-Through

Fabien Rondeau and Yushi Yoshida

Economics Working Paper Archive (University of Rennes & University of Caen) from Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS

Abstract: The theoretical model a la Amiti, Itskhoki, and Konings (2014, AER) suggests that the inclusion of exporters’ market share and import intensity in the exchange rate pass-through regression is sufficient to reflect the underlying deep parameters. We suggest using value-added by importing and other countries and invoicing currency ratio as proxies for the import intensity measure. By examining 33 exporting countries and 13 importing countries for 18 industries between 1995 and 2018, our results show that exchange rate pass-through decreases for industries with a higher contribution of the other country’s value-added. Moreover, we find that a higher US dollar invoicing ratio decreases the exchange rate pass-through.

Keywords: Exchange Rate Pass-through; Global Value Chains; Invoicing Currency; Market Share; Value-Added by Importers. (search for similar items in EconPapers)
JEL-codes: F14 F61 (search for similar items in EconPapers)
Date: 2024-09
New Economics Papers: this item is included in nep-int, nep-mon and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ged.univ-rennes1.fr/nuxeo/site/esupversion ... de-876e-1454468ec671 (application/pdf)

Related works:
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: https://EconPapers.repec.org/RePEc:tut:cremwp:2024-09

Ordering information: This working paper can be ordered from
CREM (UMR CNRS 6211) - Faculty of Economics, 7 place Hoche, 35065 Rennes Cedex - France

Access Statistics for this paper

More papers in Economics Working Paper Archive (University of Rennes & University of Caen) from Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS CREM (UMR CNRS 6211) – Faculty of Economics, 7 place Hoche, 35065 RENNES Cedex. Contact information at EDIRC.
Bibliographic data for series maintained by GERMAIN Lucie ().