Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
10477349 | Journal of International Economics | 2005 | 25 Pages |
Abstract
This paper exploits the unique case of European market integration to investigate the relationship between integration and price convergence in international markets. Using a panel data set of car prices, we examine how the process of integration has affected cross-country price dispersion in Europe. We find surprisingly strong evidence of convergence towards both the absolute and the relative versions of the Law of One Price (LOOP). Our analysis illuminates the main sources of segmentation in international markets and suggests the type of institutional changes that can successfully reduce it.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Pinelopi K. Goldberg, Frank Verboven,