International Prices and Exchange Rates
Ariel Burstein and
Chapter Chapter 7 in Handbook of International Economics, 2014, vol. 4, pp 391-451 from Elsevier
We survey the recent empirical and theoretical developments in the literature on the relation between prices and exchange rates. After updating some of the major findings in the empirical literature, we present a simple framework to interpret this evidence. We review theoretical models that generate insensitivity of prices to exchange rate changes through variable markups, both under flexible prices and nominal rigidities, first in partial equilibrium and then in general equilibrium.
Keywords: Real exchange rate; Nominal exchange rate; Border prices; Variable markups; Price rigidity; Pass-through; Tradeable goods (search for similar items in EconPapers)
JEL-codes: F3 F4 F15 (search for similar items in EconPapers)
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Working Paper: International Prices and Exchange Rates (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:intchp:4-391
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