Declines in Exchange Rate Pass-through to Export Prices in Korea
| Autor: | Lee, Hang yong, Kim, Hyeon-Wook |
|---|---|
| Jazyk: | English<br />Korean |
| Rok vydání: | 2009 |
| Předmět: | |
| Zdroj: | KDI Journal of Economic Policy, Vol 31, Iss 2, Pp 235-266 (2009) |
| Druh dokumentu: | article |
| ISSN: | 2586-2995 2586-4130 |
| DOI: | 10.23895/kdijep.2009.31.2.235 |
| Popis: | This paper investigates changes in the extent of exchange rate pass-through to export price in Korea. First, empirical results show that export prices have become less responsive to the exchange rate since the financial crisis in 1997. The decline of exchange rate pass-through to export prices suggests that Korean exporters are more likely to use profit margins to absorb part of the impact of exchange rate changes, consistent with pricing to market phenomenon. Second, this paper finds asymmetries in the response of export prices to exchange rate changes. In the post-crisis period. appreciations are more likely to be offset by markup adjustment than depreciations. Third, this paper documents that a significant portion of the decline of exchange rate pass-through is a result of both increased volatility of exchange rate and increased competition with China in the world market. |
| Databáze: | Directory of Open Access Journals |
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