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Pricing to market with transactions denominated in a common currency

Author:
Pick, D.H., Carter, C.A.
Source:
American journal of agricultural economics 1994 v.76 no.1 pp. 55-60
ISSN:
0002-9092
Subject:
agricultural products, wheat, international trade, mathematical models, trade, foreign exchange, United States, Canada
Abstract:
We present a model with two exporters who ship a differentiated commodity to the same import destination. All pricing occurs in a common currency, that of the home exporter. We show that the foreign-exporter to home-exporter exchange rate can influence the home exporter's pricing decision. It has been previously argued that only the importer to home-exporter exchange rate matters to the home exporter.
Agid:
1462444