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Global Influences on UK Manufacturing Prices

By Ken Coutts and Neville R. Norman

Abstract

This paper presents substantial new evidence on the competitive process that links together industrial economic and international economics. Our time-series data base concerns manufactured product prices and their domestic and international determinants. We identity cointegrating relationships, using single equation and multivariate methods. We find that both market imperfections, largely ignored in international economics, and international factors, mostly neglected in industrial economics, should be jointly incorporated into pricing analysis. The significance of global factors varies markedly: differentiated-product sectors respond little to foreign price signals. Our findings are relevant to many fields within economics, including the transmission of inflation

Topics: Classification-JEL: C32, D43, F14, L10, L60, industrial pricing, international competition, cointegration
Publisher: Faculty of Economics
Year: 2004
OAI identifier: oai:www.repository.cam.ac.uk:1810/296
Provided by: Apollo

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