The conventional view, as expounded by sticky-price models, is that price adjustment determines the PPP reversion rate …. This study examines the mechanism by which PPP deviations are corrected. Nominal exchange rate adjustment, not price …

In this paper we show that price equalization alone is not sufficient to determine the barriers to international trade …. There are many barrier combinations that deliver price equalization, but each combination implies a different volume of … goods will deliver price equalization in capital goods, but cannot reproduce the observed trade flows. -- international …

, conventional linear models of price dynamics such as the Vector Error Correction Model (VECM) can lead to erroneous inferences … about cointegration relationships, price adjustments and relative values. We propose the use of regime-switching models to … address these issues. Our regime switching model uses price data to infer whether pricing is oil-driven (integrated) or gas …

shocks have large and persistent price effects, while output effects tend to be moderate. The 2022 natural gas price spike … winter. Counterfactual simulations of an embargo on natural gas imports from Russia indicate similar positive price and …