@article {79471,
	title = {Slow Passthrough Around the World: A New Import for Developing Countries?},
	journal = {Open Economies Review},
	volume = {23},
	number = {2},
	year = {2012},
	pages = {213-251},
	abstract = {Developing countries traditionally experience pass-through of exchange rate changes that is greater and more rapid than high-income countries experience. This is true equally of the determination of prices of imported goods, prices of local competitors{\textquoteright} products, and the general CPI. But developing countries in the 1990s experienced a rapid downward trend in the degree of pass-through and speed of adjustment, more so than did high-income countries. As a consequence, slow and incomplete pass-through is no longer exclusively a luxury of industrial countries. Using a new data set - prices of eight narrowly defined brand commodities, observed in 76 countries - we find empirical support for some of the factors that have been hypothesized in the literature, but not for others. Significant determinants of the pass-through coefficient include per capita incomes, bilateral distance, tariffs, country size, wages, long-term inflation, and long-term exchange rate variability. Some of these factors changed during the 1990s. Part (and only part) of the downward trend in pass-through to imported goods prices, and in turn to competitors{\textquoteright} prices and the CPI, can be explained by changes in the monetary environment - including a fall in long-term inflation. Real wages work to reduce pass-through to competitors{\textquoteright} prices and the CPI, confirming the hypothesized role of distribution and retail costs in pricing to market. Rising distribution costs, due perhaps to the Balassa-Samuelson-Baumol effect, could contribute to the decline in the pass-through coefficient in some developing countries.},
	url = {http://link.springer.com/article/10.1007\%2Fs11079-011-9210-8},
	author = {Frankel, Jeffrey}
}
