From dominant to producer currency pricing: Dynamics of Chilean exports

José De Gregorio, Pablo Garcia Silva, Emiliano Luttini and Marco Rojas

Journal of International Economics, 2024, vol. 149, issue C

Abstract: We revisit a central question for international macroeconomics: the response of export prices and quantities to movements in the exchange rate (ER). We use granular export data for Chile and study how the effects of ER movements vary over time with the currency of invoicing and the destination of exports. For prices, we find that the short-run effects of bilateral ER movements vanish when controlling for U.S. dollar ER, which supports dominant currency pricing. However, over longer horizons a more significant role is played by bilateral ER movements, in line with the predictions of producer currency pricing. These dynamics do not depend on the invoicing currency. The results we find for quantities support the view that bilateral ER movements contribute to macroeconomic adjustment through export volumes over the medium term.

Keywords: Currency of invoicing; Emerging markets; Dominant currency pricing; Producer currency pricing (search for similar items in EconPapers)
JEL-codes: F14 F31 F41 (search for similar items in EconPapers)
Date: 2024
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Related works:
Working Paper: From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports (2024)
Chapter: From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports (2023)
Working Paper: From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports (2023)
Working Paper: From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:149:y:2024:i:c:s0022199624000618

DOI: 10.1016/j.jinteco.2024.103934

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