 Do capital importing countries pay higher prices for their imports of goods?Antonis Adam and Thomas Moutos Journal of International Money and Finance, 2014, vol. 40, issue C, 95-108 Abstract: We examine the effects that a country's net capital flows have on the (border) prices that a country pays for its imports of goods. Using data from 2000 to 2009 for 11 euro area countries we utilize a pricing-to-market specification to study exporters' pricing behavior to the rest of the countries in the sample, at the industry level, for 900 goods disseminated at the 4-digit Standard International Trade Classification level. This allows us to construct a panel dataset which contains observations across exporters, importers, industries and time. We find a strong positive influence of the importing country's net capital inflows on the border prices of its imports of goods. This result is robust across different specifications of the underlying model, as well to different sample dis-aggregations across types of capital flows, product categories, and exporters. Keywords: Capital flows; Import prices; Pricing to market; Globalization; Euro area (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:40:y:2014:i:c:p:95-108 DOI: 10.1016/j.jimonfin.2013.09.003 Access Statistics for this article Journal of International Money and Finance is currently edited by J. R. Lothian More articles in Journal of International Money and Finance from Elsevier |
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