Who Prices Locally? Survey Evidence of Swiss Exporters

17 Pages Posted: 30 May 2008

See all articles by Andreas M. Fischer

Andreas M. Fischer

Swiss National Bank; Centre for Economic Policy Research (CEPR)

Matthias Lutz

Swiss National Bank; University of St. Gallen

Manuel Wälti

Swiss National Bank

Multiple version iconThere are 2 versions of this paper

Date Written: September 2007

Abstract

Survey information on Swiss exporters is used to test the hypothesis that firm-specific factors, in particular firm size, are important determinants of pricing-to-market (PTM). The survey asked exporters whether they set different prices across markets and, if so, whether price segmentation occurred because of pricing conditions in the local market or other factors. The empirical analysis is based on a probit model that regresses a binary-choice variable of PTM on firm size and other control variables. The main empirical finding is that firm size and PTM are positively and significantly correlated. A further result is that while firms whose main export market is in the Euro area are less likely to engage in PTM, firm size plays a bigger role for them. These results are robust across different PTM classifications, regression specifications, export destinations, and industrial sectors.

Keywords: firm size, local currency pricing, Pricing to markets

JEL Classification: F10, F14

Suggested Citation

Fischer, Andreas M. and Lutz, Matthias and Wälti, Manuel, Who Prices Locally? Survey Evidence of Swiss Exporters (September 2007). CEPR Discussion Paper No. DP6442, Available at SSRN: https://ssrn.com/abstract=1138555

Andreas M. Fischer (Contact Author)

Swiss National Bank ( email )

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Centre for Economic Policy Research (CEPR)

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United Kingdom

Matthias Lutz

Swiss National Bank ( email )

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Switzerland
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University of St. Gallen ( email )

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CH-9000 St. Gallen
Switzerland
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Manuel Wälti

Swiss National Bank ( email )

Research
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Zuerich, 8022
Switzerland

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