Pricing in International Markets: A 'Small Country' Benchmark
David Parsley
No 112001, Working Papers from Hong Kong Institute for Monetary Research
Abstract:
This study examines exchange rate pass-through in a 'small country' context. The study uses a panel of disaggregated exports from Hong Kong to its major flexible exchange rate destinations since 1992. Most existing evidence on pass-through is taken from G7 countries and finds that export prices (in the importing currency) respond less than fully to exchange rate changes. The notable exception is for exports from the United States. Existing evidence suggests that exporters from the U.S. apparently do not mitigate export prices in response to exchange rates, while other countries' exporters routinely pass-through less than 100% of exchange rate changes. This study provides a benchmark by which to interpret the puzzling behavior of U.S. export prices. Empirically, Hong Kong's export price behavior overwhelmingly supports the competitive paradigm. In only a few cases is there evidence of less than complete pass-through by Hong Kong's exporters. The panel data set also allows an additional question to be addressed. In particular, there is no evidence of differences in pass-through across export destinations. Thus, by inference, near complete pass-through by U.S. exporters suggests similar competitive behavior.
Pages: 17 pages
Date: 2001-10
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
http://www.hkimr.org/uploads/publication/313/ub_full_0_2_52_wp11_01.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.hkimr.org/uploads/publication/313/ub_full_0_2_52_wp11_01.pdf [301 Moved Permanently]--> http://www.aof.org.hk/research/HKIMR/uploads/publication/313/ub_full_0_2_52_wp11_01.pdf [301 Moved Permanently]--> https://www.aof.org.hk/research/HKIMR/uploads/publication/313/ub_full_0_2_52_wp11_01.pdf)
Related works:
Journal Article: Pricing in International Markets: a “Small‐country” Benchmark (2004) 
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:hkm:wpaper:112001
Access Statistics for this paper
More papers in Working Papers from Hong Kong Institute for Monetary Research Contact information at EDIRC.
Bibliographic data for series maintained by HKIMR ().