When the exchange rate fluctuates and the market exhibits hysteresis, planning horizons of domestic and foreign competitors will matter in determining pass-through as well as relative market shares of these firms. Using the Cournot duopoly model, it is shown that if the foreign exporter is a...

In the literature on exports and investment, most productive firms are seen to invest abroad. In the Helpman et al. (2004) model, costs of transportation play a critical role in the decision about whether to serve foreign customers by exporting, or by producing abroad. We consider the case of...

Using domestic and export price data and a framework of markup over cost, pricing behavior of U.S. and Japanese manufacturers is compared. Major export industries in Japan have higher productivity growth and lower pass-through coefficients than American exporters, who tend to price to domestic...