EXCHANGE RATE PASS-THROUGH EFFECTS: A DISAGGREGATE ANALYSIS OF COLOMBIAN IMPORTS OF MANUFACTURED GOODS
Hernan Rincon-Castro (),
Édgar Caicedo () and
Norberto Rodríguez N. ()
Revista ESPE - Ensayos sobre Política Económica, 2007, vol. 25, issue 54, No 54, 90-121
This paper quantifi es the exchange rate passthrough effects on import prices within a sample of Colombian manufactured imports. Also, whether the foreign exchange and infl ation regimes affect the degree of pass-through is evaluated. The analytical framework used was a mark-up model. The main fi nding is that the long-run pass-through elasticities are stable and go from 0.1 to 0.8 and the short-run ones are unstable and go from 0.1 to 0.7, supporting mark-up hypotheses, in contrast to the hypotheses of perfect market competition and complete pass-through. The fi ndings also show evidence of the variability and different degrees of pass-trough among manufacturing sectors, which confi rm the importance of using dynamic models and disaggregate data for an analysis of the pass-through. Both, the hypothesis that under a fl oating regime there is a low degree of pass-through and the hypothesis that a low infl ation environment has the same result are not supported.
Keywords: Pass-through effects; PPP; imperfect competition; fl oating regime; low infl ation environment; fi xed parameter model; time-varying parameter model; Kalman fi ltering (search for similar items in EconPapers)
JEL-codes: F31 F41 E31 E52 C32 C51 C52 (search for similar items in EconPapers)
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Journal Article: Exchange rate pass-through effects: A disaggregate analysis of Colombian imports of manufactured goods (2007)
Working Paper: Exchange Rate Pass-Through Effects: A Disaggregate Analysis of Colombian Imports of Manufactured Goods (2005)
Working Paper: EXCHANGE RATE PASS-THROUGH EFFECTS: A DISAGGREGATE ANALYSIS OF COLOMBIAN IMPORTS OF MANUFACTURED GOODS (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:bdr:ensayo:v:25:y:2007:i:54:p:90-121
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