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Pricing to Market when the Exchange Rate Changes

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Krugman, Paul·1986·National Bureau of Economic Research

Abstract

It has been widely remarked that US import prices have not fully reflected movements in the exchange rate.This paper begins with an investigation of the actual extent of "pricing to market" by foreign suppliers.It shows that pricing to market is a real phenomenon, but not universal; in particular, evidence on German export prices suggests that stickiness of import prices is largely confined to machinery and transport equipment.The paper then considers a number of possible models.While the evidence is not sufficient to distinguish among these models, it seems probable that a full explanation will involve both dynamics and imperfect competition.

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Metadata

Authors
Krugman, P.
Venue
National Bureau of Economic Research
Published
1986-05
OpenAlex
W1599024647
Cited by
984
References
0
Type
report
Language
en
Open access
green

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CoChat. (2026). Citation check: Pricing to Market when the Exchange Rate Changes. https://app.cochat.ai/papers/10.3386/w1926
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Krugman, P. (1986). Pricing to Market when the Exchange Rate Changes. National Bureau of Economic Research. https://doi.org/10.3386/w1926

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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).

Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.