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한국개발연구. Vol. 31, No. 2, December 2009, pp. 235-266
https://doi.org/10.23895/kdijep.2009.31.2.235
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Declines in Exchange Rate Pass-through to Export Prices in Korea
Abstract
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.
Keywords
환율전가(exchange rate passthrough), 수출가격(export price), 비대칭성(asymmetry)
JEL Code
E31, F31, F41
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Other articles from this issue
- Testing for Nonlinear Threshold Cointegration in the Monetary Model of Exchange Rates with a Century of Data...... Junsoo Lee·Mark C. Strazicich
- Analyzing the Effect of Changes in the Benchmark Policy Interest Rate Using a Term Structure Model
- Changes in the Business Cycle of the Korean Economy: Evidence and Explanations
- Market Power of Internet Portals with Direct and Indirect Network Externality
- The Impacts of Smoking Bans on Smoking in Korea
- Growth of Felonies after the 1997 Financial Crisis in Korea
- The Role of Extensive and Intensive Margins in Korean Exports to China
- Declines in Exchange Rate Pass-through to Export Prices in Korea
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