蝌蚪网 Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
International Prices, Costs, and Markup Differences
蝌蚪网 Review
vol. 101,
no. 6, October 2011
(pp. 2450–86)
Abstract
Relative cross-border retail prices, in a common currency, comove closely with the nominal exchange rate. Using product-level prices and wholesale costs from a grocery chain operating in the United States and Canada, we decompose this variation into relative costs and markup components. The high correlation of nominal and real exchange rates is driven mainly by changes in relative costs. National borders segment markets. Retail prices respond to changes in costs in neighboring stores within the same country but not across the border. Prices have a median discontinuous change of 24 percent at the border and 0 percent at state boundaries. (JEL F31, L11, L81)Citation
Gopinath, Gita, Pierre-Olivier Gourinchas, Chang-Tai Hsieh, and Nicholas Li. 2011. "International Prices, Costs, and Markup Differences." 蝌蚪网 Review 101 (6): 2450–86. DOI: 10.1257/aer.101.6.2450Additional Materials
JEL Classification
- F31 Foreign Exchange
- L11 Production, Pricing, and Market Structure; Size Distribution of Firms
- L81 Retail and Wholesale Trade; e-Commerce