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Exchange Rate Pass-Through Effects:A Disaggregate Analysis Of Colombianimports Of Manufactured Goods

Listed author(s):
  • HERNÁN RINCÓN

    ()

  • ÉDGAR CAICEDO

    ()

  • NORBERTO RODRÍGUEZ

    ()

This paper quantifi es the exchange rate pass-through effects on import prices within a sample of Colombian manufactured imports. Also, whether the foreign exchange and infl ation regimes affect the degree of pass-through is evaluated. The analytical framework used was a mark-up model. The main fi nding is that the long-run pass-through elasticities are stable and go from 0.1 to 0.8 and the short-run ones are unstable and go from 0.1 to 0.7, support-ing mark-up hypotheses, in contrast to the hypoth-eses of perfect market competition and complete pass-through. The fi ndings also show evidence of the variability and different degrees of pass-trough among manufacturing sectors, which confi rm the importance of using dynamic models and disaggre-gate data for an analysis of the pass-through. Both, the hypothesis that under a fl oating regime there is a low degree of pass-through and the hypothesis that a low infl ation environment has the same result are not supporte

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Article provided by BANCO DE LA REPÚBLICA - ESPE in its journal ENSAYOS SOBRE POLÍTICA ECONÓMICA.

Volume (Year): 25 (2007)
Issue (Month): 54 (June)
Pages: 90-121

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Handle: RePEc:col:000107:004641
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