From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports

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

No 32175, NBER Working Papers from National Bureau of Economic Research, Inc

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 exchange rate movements contribute to macroeconomic adjustment through export volumes over the medium term.

JEL-codes: F14 F31 F41 (search for similar items in EconPapers)
Date: 2024-02
New Economics Papers: this item is included in nep-int, nep-mon and nep-opm
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Published as José De Gregorio & Pablo García & Emiliano Luttini & Marco Rojas, 2024. "From dominant to producer currency pricing: Dynamics of Chilean exports," Journal of International Economics, .
Published as From Dominant to Producer Currency Pricing: Dynamics of Chilean Exports , José De Gregorio, Pablo García, Emiliano Luttini, Marco Rojas. in NBER International Seminar on Macroeconomics 2023 , Frankel and Rey. 2024

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Journal Article: From dominant to producer currency pricing: Dynamics of Chilean exports (2024)
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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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