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Multinational companies marketing their undifferentiated products to different countries unintentionally may create a problem for themselves. A low price in one country may encourage an enterprise to transship the products to another country with higher price, creating a new channel of parallel imports that competes with the authorized channels there. By setting prices reflecting differences in willingness to pay in the different countries, multinational firms are “setting” prices for their products in separable channels. In light of this problem of parallel import channels competing with the authorized channels, multinationals need to carefully establish their pricing strategies for the global marketplace.

This chapter analyzes the exchange rate pass-through (ERPT) into different prices for 12 euro area (EA) countries. We provide new up-to-date estimates of ERPT by paying attention to either the time-series properties of data and variables endogeneity. Using VECM framework, we examine the pass-through at different stages along the distribution chain, that is, import prices, producer prices, and consumer prices. When carrying out impulse response functions analysis, we find a higher pass-through to import prices with a complete pass-through (after one year) detected for roughly half of EA countries. These estimates are relatively large compared to single-equation literature. We denote that the magnitude of the pass-through of exchange rate shocks declines along the distribution chain of pricing, with the modest effect recorded for consumer prices. When assessing for the determinant of cross-country differences in the ERPT, we find that inflation level, inflation volatility, and exchange rate persistence are the main macroeconomic factors influencing the pass-through almost along the pricing chain. Thereafter, we have tested for the decline of the response of consumer prices across EA countries. According to multivariate time-series Chow test, the stability of ERPT coefficients was rejected, and the impulse responses of consumer prices over 1990–2010 provide an evidence of general decline in rates of pass-through in most of the EA countries. Finally, using the historical decompositions, our results reveal that external factors, that is, exchange rate and import prices shocks, have had important inflationary impacts on inflation since 1999 compared to the pre-EMU period.

The purpose of this study is to examine the degree of trade mispricing in the US fresh banana trade with Latin American and Caribbean countries using a new alternative measure in estimating arm’s length price.

A key feature of the research design is that we use the actual free market price of commodity (e.g. fresh banana price) as a benchmark for arm’s length price rather than relying on interquartile range, which is known to be problematic.

The paper finds that when the degree of mispricing is measured by two widely used methods, interquartile price filter and partner-country methods, we find little evidence of undervaluation or overvaluation of US banana import. However, when we use the free-market price of fresh banana as a benchmark for arm’s length price, first adopted in this study, the average undervalued amount of trade compared to the total banana import declared value by the US importers is on average 54 per cent during the period between 2000 and 2009.

This study suggests a new simple measure in estimating arm’s length traction price in studying trade mispricing.

The purpose of this paper is to characterise across all nuts UK market imports and determine the relative importance of an overall price/quantity relationship to the importance of specific relationships for individual nuts.

Using log price/demand monthly and annual import data elasticities were determined across the total UK nut market and for individual species. These were compared to an empirical model to develop an understanding of the market. Data were principally from FAOSTAT and HMRC databases.

The UK imports are 5 per cent of the global nut trade, predominantly shelled with little internal production. Across ten species and 12 years price/demand regression models (1999-2010) were significant (R2=0.75) with an elasticity of −2.06 (less import of higher cost nuts). Consistent model deviations were found for some nuts indicating non price demand effects. Macadamias were imported at 23 per cent of expectation relative to their price point. Monthly (2007-2010) and annual (1999-2010) elasticities were compared for individual nuts. Pistachio and cashew showed “normal” negative elasticities (−1.5 to −1.0) for both time scales. However, walnuts had negative (−2.2) elasticity using monthly data but positive (+1.0) using annual data.

These data suggest detailed analyses of the individual nut supply demand market and consumer preferences are needed to explain different market behaviour over time and among nut species.

Nut importers and producers may be able to use this data to better develop value for their product in consumer eyes and hence provide an improved value chain.

This paper demonstrates how a broad empirical elasticity modelling approach to an agrifood market may increase the understanding of market needs.

The purpose of this paper is to estimate China's demand for imported soybeans and soybean oil from both country‐of‐origin and product form perspectives.

A differential production approach is used to estimate China's demand for imported soybeans and soybean oil. The empirical demand estimates are then used to derive conditional and unconditional elasticities of demand for each exporting country with respect to changes in domestic and import prices, and the price of resources used in soybean meal and oil production.

Results indicate that both country‐of‐origin and product form competition exist in the Chinese market. Estimation results indicate that China's soybean meal prices significantly impacted its soybean and soybean oil imports. Seasonality is detected in China's soybean imports, but not in soybean oil imports.

The findings suggest that, in addition to country‐of‐origin competition, product form competition should be considered when analyzing China's soybean demand.

This paper contributes to a better understanding of China's soybean import market by integrating both country‐of‐origin competition and product form competition into a single demand framework.

As might be expected, steel product prices fell during the recession of the early 1990s. Between 1990 and 1992, steel prices fell by about a third. As the economies of the EC recovered from the recession from early 1993, steel prices rose but by mid‐year it was clear that the increase was much below what was expected. It soon became clear that expected price rises were being mitigated by rising imports from Eastern European countries. This paper considers the process of steel price determination in the EC and the effect of cheap imports on EC prices. It shows that unregulated and relatively cheaper imports from the Former Soviet Union and Central and Eastern European countries indeed had a more depressing effect on EC prices by raising supply than would have been the case otherwise.