Cost Pass-Through in the U.S. Automobile Market

Anne Gron and Deborah Swenson ()

The Review of Economics and Statistics, 2000, vol. 82, issue 2, 316-324

Abstract: We study cost pass-through in the U.S. automobile market using a framework that incorporates the effects of cost changes on input decisions. We find that accounting for firms' factor-market decisions significantly increases measured cost pass-through, although we reject the hypothesis of full cost pass-through and constant markups. In addition, our evidence suggests that cost shocks common to all manufacturers have a greater effect on prices than do model-specific cost shocks. Finally, we examine how pass-through varies with manufacturer nationality, finding that U.S. firm cost pass-through exceeds that of European and Asian firms. © 2000 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (28)

Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/003465300558704 (application/pdf)
Access to full text is restricted to subscribers.

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:tpr:restat:v:82:y:2000:i:2:p:316-324

Ordering information: This journal article can be ordered from
https://mitpressjour ... rnal/?issn=0034-6535

Access Statistics for this article

The Review of Economics and Statistics is currently edited by Pierre Azoulay, Olivier Coibion, Will Dobbie, Raymond Fisman, Benjamin R. Handel, Brian A. Jacob, Kareen Rozen, Xiaoxia Shi, Tavneet Suri and Yi Xu

More articles in The Review of Economics and Statistics from MIT Press
Bibliographic data for series maintained by The MIT Press ().