CCER讨论稿:Imports and RMB Exchange Rate Pass-Through: Marginal Cost versus Quality Change

发布日期:2018-07-10 16:27:53    来源:北京大学国家发展研究院

E2018017                                       2018-07-10
Yaqi Wang  Miaojie Yu
July 2018


This article investigates the differential impacts of exchange rate movements on Chinese export prices during 2000–11, based on highly disaggregated firm-product-level customs transaction data. The investigation finds that exchange rate pass-through at the micro level in China is nearly complete. Exporters’ pervasive imports of intermediate inputs significantly decrease the exchange rate pass-through to import prices more among homogeneous goods than differentiated goods. The analysis finds that exporters adjust the quality of their exports facing exchange rate movement, weakening the impacts of changes in the cost of importing intermediate inputs. For an exporter with high propensity to import intermediate inputs, the exchange rate pass-through is 83 percent (93 percent) at the 5th (95th) percentile of the distribution of quality change. Large exporters dominate Chinese exports and are associated with high intensity of importing intermediate inputs and export quality upgrading. These findings help explain the insensitivity of Chinese export prices to exchange rate movements.

JEL: F1, F3, F4

Key words: Exchange rate pass-through; Chinese product quality; Importing intermediate inputs