One TV, One Price?
Jean M. Imbs
Paris School of Economics (PSE); Centre for Economic Policy Research (CEPR); Swiss Finance Institute
University of London - Faculty of Social Sciences
Morten O. Ravn
European University Institute - Economics Department (ECO); London Business School - Department of Economics; University of Southampton; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)
affiliation not provided to SSRN
Scandinavian Journal of Economics, Vol. 112, No. 4, pp. 753-781, December 2010
We study television prices across European countries and regions. Quality as measured by observable characteristics of televisions accounts for a large share of the international dispersion in prices. Rich economies tend to consume higher-quality goods, but sizeable international price differentials exist even for identical televisions. The valuation of brands differs significantly across borders. EMU countries display lower price dispersion but not necessarily because of the single currency. Absolute price differentials and relative price volatility increase with exchange rate volatility, but not with transport costs. Exchange rate pass-through is low in the short run but high in the long run.
Number of Pages in PDF File: 29Accepted Paper Series
Date posted: November 16, 2010
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