Dynamic pricing is a widely employed strategy for goods and services in which firms flexibly set prices, taking into account factors such as current market conditions. This paper studies the role this plays explaining exchange rate pass-through context of package tour prices. We provide theoretical model that illustrates how foreign producers domestic retailers adjust prices to fluctuations thr...

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 ...