Exchange Rate Pass-Through on EBay

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Abstract/Contents

Abstract: In this paper, I measure exchange rate pass-through based on eBay transactions. I focus on “seller experiments,” exploiting situations in which a seller lists an item multiple times. I start with U.S. import pass-through from Australia, Canada, Germany, Japan, and the United Kingdom. I calculate an average short-run pass-through of 0.2, which is comparable to estimates in the literature. I then measure pass-through at the monthly, weekly, and daily level. I find monthly pass-through decreases over time, while daily pass through peaks after about seven days before decreasing. Next, I examine how an item’s uniqueness, its seller volume, and its price affect pass-through. I find that unique items garner a higher pass-through than mainstream, that items from high-volume sellers have a higher pass-through than from low, and that item price has no effect on pass-though. Finally, I measure both import and export pass-through for a variety of OECD countries. I find weak evidence that the two are inversely related, and that the greater a country’s currency’s influence on the world or other countries, the lower its import pass-through and higher its export pass-through. I examine pass-through between country pairs and find similar pass-through estimates between a country and a group of countries similar to each other.

Type of resource	text
Date created	May 2013

Author	Lott, Zachariah
Primary advisor	Einav, Liran
Degree granting institution	Stanford University, Department of Economics

Subject	Stanford Department of Economics
Subject	pass-through
Subject	pricing to market
Subject	internet markets
Genre	Thesis

Related item	Title 2013 Anna Laura Myers Prize for an Outstanding Thesis
Location	https://purl.stanford.edu/vw927zx2262

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Preferred Citation: Lott, Zachariah. (2013). Exchange Rate Pass-Through on EBay. Stanford Digital Repository. Available at: https://purl.stanford.edu/vw927zx2262

Stanford University, Department of Economics, Honors Theses

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