Lecture 5 - Isabelle MEJEAN's home page
Lecture 5 - Isabelle MEJEAN's home page
Lecture 5 - Isabelle MEJEAN's home page
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Betts & Devereux (1996)<br />
Campa & Goldberg (2006)<br />
Hypotheses (5): Supply side<br />
Possibility of double marginalization:<br />
The distribution margin m t (i), i = h/f is possibly sensitive to<br />
exchange rates ⇒ Allows for possible deviations from the<br />
competitive distribution sector assumed in the model<br />
Exchange rate sensitivity of import shares:<br />
Imported input shares, µ t (i), i = h/n can be sensitive to exchange<br />
rate movements ⇒ Incomplete ERPT on imported inputs or<br />
sensitivity of the local content to exchange rates.<br />
<strong>Isabelle</strong> Méjean <strong>Lecture</strong> 5
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