This paper investigates the size and nature of exchange rate pass through to import prices for a panel of 14 emerging economies. We firstly set out a stylized model in which import prices are dependent upon the exchange rate, marginal cost and the mark up. We employed methods which account for panel heterogeneity, distinguish between long and short run pass through effects and allow for asymmetries. Our results show that import prices respond on average positively, but incompletely, to the exchange rate. However, there are important differences between Latin American and Asia once we take account of asymmetry.
|Publisher||University Of Glasgow|
|Number of pages||31|
|Publication status||Published - 2010|
|Name||SIRE Discussion Papers|
Byrne, J. P., Chavali, A., & Kontonikas, A. (2010). Exchange rate pass through to import prices: Panel evidence from emerging market economies. (SIRE Discussion Papers; No. 2010-46). University Of Glasgow. http://hdl.handle.net/10943/182