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We use retail transaction prices for a multinational retailer to examine the extent and permanence of violations of the law of one price (LOOP). For identical products, we find typical deviations of twenty to fifty percent, though there is muted evidence for convergence over time. Such...
Persistent link: https://www.econbiz.de/10011398034
A large body of literature finds that exporters do not pass nominal exchange rate movements fully through to destination market prices over short time horizons. This imperfect passthrough has been widely attributed to strategic pricing-to-market , whereby exporters deliberately accept changes in...
Persistent link: https://www.econbiz.de/10011398066