This paper investigates the implications of endogenous trade participation for international business cycles, trade flow dynamics and exchange rate pass-through when price adjustments are staggered across firms. I develop a two-country dynamic stochastic general equilibrium model wherein firms make state-dependent decisions on entry and exit in the export market and the frequency of price adjus...

Abstract We use detailed data for Iceland to examine two often-neglected aspects of the exchange rate pass-through problem. First, we investigate whether coefficient varies with degree international tradability goods. Second, analyze if depends on monetary policy framework. consider 12 disaggregated price indexes in 2003–2019, a period that includes Iceland’s banking and currency crisis 2008. f...

This article investigates the relationship between the exchange rate and non-oil trade balance in Iran between 1981 and 2014. A structural vector auto-regression model is built. The results indicated that the increasing effect of the real effective exchange rate worsens the non-oil trade balance in the short term. In contrast, the increasing effect of the real effective exchange rate improves t...

This paper offers new insights into the nature of exchange rate pass through modelling in the context of a Markov regime-switching environment. Using New Zealand data, the results indicate that pass through to import prices resulting from fluctuations in the exchange rate or exporter costs can be characterised as regime-specific. Furthermore, there is evidence that the probability of switching ...

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