This paper examines the role of global value chains development in reducing exchange rate pass-through (ERPT) to import and producer prices. In contrast existing research, we assume that decline ERPT resulting from enhanced participation GVC may be non-linear with respect country’s position chain due different firms’ market power at various stages vertical specialization. We investigate a panel...

This study explains the asymmetric Exchange Rate Pass-Through (ERPT) to inflation in Indonesia, Malaysia, and Philippines, which adopted floating exchange rate after 1998 financial crisis. Our empirical results show existence of long-run ERPT such that there is no full transmission depreciation each country. The highest degree occurred while Philippines (appreciation) not completely transmitted...