This paper investigates the relevance of traditional trade-exchange rate theorems for developing countries facing sunk entry costs in international markets. Firstly, the theorems analysing pricing of tradable goods and the trade balance dynamics following exchange rate shocks are accounted for....

The country studies and their background papers included in this book were prepared for the Latin America and the Caribbean section of the "Global Research Project: Explaining Growth" of the Global Development Network (GDN), a research effort conducted in association with the Latin American and...