01764cas a2200253 a 4500 AALejournalIMF001786 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451859867 1018-5941 BD-DhAAL BD-DhAAL Hakura, Dalia. Exchange Rate Pass-Through to Domestic Prices : Does the Inflationary Environment Matter? / Dalia Hakura, Ehsan Choudhri. Washington, D.C. : International Monetary Fund, 2001. 1 online resource (36 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The paper tests a hypothesis suggested by Taylor (2000) that a low inflationary environment leads to a low exchange rate pass-through to domestic prices. To test this hypothesis, the paper derives a pass-through relation based on new open economy macroeconomic models. A large database that includes 1979-2000 data for 71 countries is used to estimate this relation. There is strong evidence of a positive and significant association between the pass-through and the average inflation rate across countries and periods. The inflation rate, moreover, dominates other macroeconomic variables in explaining cross-regime differences in the pass-through. Mode of access: Internet Choudhri, Ehsan. IMF Working Papers; Working Paper ; No. 2001/194 Full text available on IMF http://elibrary.imf.org/view/journals/001/2001/194/001.2001.issue-194-en.xml IMF e-Library