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Commodities Price Pass-Through in Costa Rica, Does the Level of Competition influence?

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  • Álvarez Corrales, Cristian
  • Esquivel Monge, Manfred

Abstract

We study the presence of asymmetries in the pass-through of commodities prices to domestic prices in Costa Rica by means of structural distributed lags models to deal with the asymptotic bias that emerges when censored VAR models (the traditional approach) are employed to capture asymmetries. The pass-through to consumer price index does not show evidence of asymmetry, but in products associated with wheat, maize, rice and fertilizers the pass-through is asymmetric. We also found that the asymmetry becomes higher as the concentration of suppliers increases.

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  • Álvarez Corrales, Cristian & Esquivel Monge, Manfred, 2018. "Commodities Price Pass-Through in Costa Rica, Does the Level of Competition influence?," Revista de Ciencias Económicas, Instituto de Investigaciones en Ciencias Económicas, Universidad de Costa Rica, vol. 36(1), January.
    • Handle: RePEc:rce:rvceco:33855
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    References listed on IDEAS

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    1. Joanne Cutler & Carrie Chan & Unias Li, 2005. "The Relationship between Commodity and Consumer Prices in Mainland China and Hong Kong," Working Papers 0508, Hong Kong Monetary Authority.
    2. Frederick T. Furlong & Robert Ingenito, 1996. "Commodity prices and inflation," Economic Review, Federal Reserve Bank of San Francisco, pages 27-47.
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