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Exchange Rate Pass-Through and International Pricing Strategy: A Conceptual Framework and Research Propositions

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Listed:
  • Terry Clark

    (Southern Illinois University)

  • Masaaki Kotabe

    (Temple University)

  • Dan Rajaratnam

    (Baylor University)

Abstract

The extent to which exchange rate fluctuations affect international prices is called “exchange rate pass-through.” This paper develops a conceptual model in explaining how exchange rate fluctuations are channeled into international pricing strategy, and offers research propositions. Our model posits that the extent of exchange rate pass-through in international pricing is affected by the firm's pricing orientation, performance orientation, distribution policy, and brand equity, as well as by exchange rate uncertainty and competitive symmetry.© 1999 JIBS. Journal of International Business Studies (1999) 30, 249–268

Suggested Citation

  • Terry Clark & Masaaki Kotabe & Dan Rajaratnam, 1999. "Exchange Rate Pass-Through and International Pricing Strategy: A Conceptual Framework and Research Propositions," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 30(2), pages 249-268, June.
  • Handle: RePEc:pal:jintbs:v:30:y:1999:i:2:p:249-268
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    Citations

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    Cited by:

    1. Herrmann-Pillath Carsten, 2001. "A General Refutation of the Law of One Price as Empirical Hypothesis / Eine allgemeine Widerlegung des „Gesetzes des einheitlichen Preises“ als einer empirischen Hypothese," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 221(1), pages 45-67, February.
    2. Sousa, Carlos M.P. & Bradley, Frank, 2008. "Antecedents of international pricing adaptation and export performance," Journal of World Business, Elsevier, vol. 43(3), pages 307-320, July.
    3. Doren Chadee & Billy Pang, 2008. "Technology strategy and performance: a study of information technology service providers from selected Asian countries," Service Business, Springer;Pan-Pacific Business Association, vol. 2(2), pages 109-126, June.
    4. Radhakrishnan, Suresh & Tsang, Albert, 2011. "The valuation-relevance of the foreign translation adjustment: The effect of barriers to entry," The International Journal of Accounting, Elsevier, vol. 46(4), pages 431-458.
    5. Brissimis, Sophocles N. & Kosma, Theodora S., 2007. "Market power and exchange rate pass-through," International Review of Economics & Finance, Elsevier, vol. 16(2), pages 202-222.
    6. Guneratne Banda Wickremasinghe & Param Silvapulle, 2004. "Role of Exchange Rate Volatility in Exchange Rate Pass-Through to Import Prices: Some Evidence from Japan," International Finance 0406006, EconWPA.
    7. repec:eee:iburev:v:27:y:2018:i:3:p:501-513 is not listed on IDEAS
    8. repec:pal:jmarka:v:5:y:2017:i:2:d:10.1057_s41270-017-0018-2 is not listed on IDEAS
    9. Boehe, Dirk Michael, 2014. "Strategic hedging: Evidence from Brazilian exporters," Journal of World Business, Elsevier, vol. 49(3), pages 290-300.
    10. Young-Han Kim & Praveen Aggarwal & Young-Myung Ha & Tai Hoon Cha, 2006. "Optimal pricing strategy for foreign market entry: a game theoretic approach," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 27(8), pages 643-653.

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