Two-sided heterogeneity and exchange rate pass-through

摘要

The bargaining process between exporters and importers is key to understand the degree of exchange rate pass-through. Following the framework established by Goldberg and Tille (2013), we use a Colombian exporter-importer matched data from 2005 to 2014 to identify the relative bargaining power between exporters and importers, and investigate its effect on exchange rate pass-through. The results show that, within each exporter-importer pair, the role of importers is at least as important as exporters, and higher bargaining power of importers are usually associated with higher exchange rate pass-through. Our findings are robust to a variety of bargaining ability measurement, alternative empirical specifications, and the selection of certain industries. (C) 2019 Elsevier B.V. All rights reserved.