Pricing-to-Market Behavior: Japanese Exports to the US, Asia, and the EU |
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Authors: | Yuri Nagataki Sasaki |
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Institution: | Department of Economics, Meiji Gakuin University, Tokyo 108-8636, Japan |
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Abstract: | The paper examines the pricing-to-market (PTM) behavior of Japanese exporters in the US, Asian, and EU markets. Empirical evidence shows that PTM elasticity is highest to the US market. This matches the in-tuitive reasoning that the US market is more competitive than the EU and Asian markets for Japanese exporters. Furthermore, PTM elasticities estimated in this paper using expected exchange rates are positive but their amounts are smaller than PTM elasticities estimated by previous studies with actual exchange rates. The difference may be due to the fact that the invoice currency for most Japanese exports is the US dollar. |
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