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Exchange Rate Pass-Through and Dynamic Oligopoly An Empirical Investigation

This paper explicitly takes into account the dynamic oligopolistic rivalry among source producers to evaluate the degree of exchange rate pass-through. Using recent time-series techniques for the case of imported automobiles in Switzerland, the results show that prices are strategic complements and...

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Bibliographic Details
Main Author: Gross, Dominique
Other Authors: Schmitt, Nicolas
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 1999
Series:IMF Working Papers
Subjects:
Deflation
Exchange Rate Adjustments
Payment Systems
Asset Prices
Monetary Economics
Empirical Studies Of Trade
Monetary Systems
Automobiles
Money
Foreign Exchange
Currency
Exchange Rate Pass-through
Standards
Government And The Monetary System
Price Level
Other Transportation Equipment
Inflation
Prices
Money And Monetary Policy
Related Parts And Equipment
Regimes
Currencies
Oligopoly And Other Imperfect Markets
Macroeconomics
Models Of Trade With Imperfect Competition And Scale Economies
Exchange Rates
Belgium
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:This paper explicitly takes into account the dynamic oligopolistic rivalry among source producers to evaluate the degree of exchange rate pass-through. Using recent time-series techniques for the case of imported automobiles in Switzerland, the results show that prices are strategic complements and that the degree of pass-through is lower in the long run than in the short run. We attribute this to the fact that, although some rivals match long-term price changes, others do not, inducing the producer who faces a change in exchange rate to absorb a greater proportion of the variation
Physical Description:33 pages
ISBN:9781451846621

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