TY - JOUR
T1 - Price setting in online markets
T2 - basic facts, international comparisons, and cross-border integration
AU - Gorodnichenko, Y.
AU - Talavera, O.
PY - 2017/1/1
Y1 - 2017/1/1
N2 - We document basic facts about prices in online markets in the United States and Canada, which is a rapidly growing segment of the retail sector. Relative to prices in regular stores, prices in online markets are more flexible and exhibit stronger pass-through (60-75 percent) and faster convergence (half-life less than two months) in response to movements of the nominal exchange rate. Multiple margins of adjustment are active in the process of responding to nominal exchange rate shocks. Properties of goods, sellers, and markets are systematically related to pass-through and the speed of price adjustment for international price differentials.
AB - We document basic facts about prices in online markets in the United States and Canada, which is a rapidly growing segment of the retail sector. Relative to prices in regular stores, prices in online markets are more flexible and exhibit stronger pass-through (60-75 percent) and faster convergence (half-life less than two months) in response to movements of the nominal exchange rate. Multiple margins of adjustment are active in the process of responding to nominal exchange rate shocks. Properties of goods, sellers, and markets are systematically related to pass-through and the speed of price adjustment for international price differentials.
UR - http://www.scopus.com/inward/record.url?eid=2-s2.0-85009223513&partnerID=MN8TOARS
U2 - 10.1257/aer.20141127
DO - 10.1257/aer.20141127
M3 - Article
SN - 0002-8282
VL - 107
SP - 249
EP - 282
JO - The American Economic Review
JF - The American Economic Review
IS - 1
ER -