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|Abstract:||We show empirically that the variation across country pairs in exchange rate pass-through and trade elasticity is meaningfully explained by the dollar's dominance as invoicing currency. We use a hierarchical Bayesian approach to directly and flexibly model pass-through heterogeneity conditional on the invoicing currency share. We estimate that the importer's country-level dollar invoicing share explains 15 percent of the overall variance across trading pairs in dollar exchange rate pass-through into bilateral prices.|
|Citation:||Boz, Emine, Gopinath, Gita, Plagborg-Moller, Mikkel. (2019). Dollar Invoicing and the Heterogeneity of Exchange Rate Pass-Through. AEA PAPERS AND PROCEEDINGS, 109 (527 - 532. doi:10.1257/pandp.20191009|
|Pages:||527 - 532|
|Type of Material:||Journal Article|
|Journal/Proceeding Title:||AEA PAPERS AND PROCEEDINGS|
|Version:||Final published version. Article is made available in OAR by the publisher's permission or policy.|
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