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Transparency and product variety

✍ Scribed by Christian Schultz

Book ID: 116422179
Publisher: Elsevier Science
Year: 2009
Tongue: English
Weight: 150 KB
Volume: 102
Category: Article
ISSN: 0165-1765
DOI: 10.1016/j.econlet.2008.12.008

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## Abstract We study the role of exchange rate variability in the firm's choice of whether to offer one or two varieties. We show that variability induces the firm to vertically segment markets (offer two varieties). This happens because variability in the exchange rate affects income dispersion an