@article{Goldberg:295141, recid = {295141}, author = {Goldberg, Linda S and Tille, Cédric}, title = {Micro, macro, and strategic forces in international trade invoicing}, publisher = {Hong Kong Institute for Monetary Research}, address = {Hong Kong. 2010}, number = {BOOK}, series = {HKIMR Working Paper ; No.08/2010}, pages = {41 p. : ill.}, year = {2010}, abstract = {The use of different currencies in the invoicing of international trade transactions plays a major role in the international transmission of economic fluctuations. Existing studies argue that an exporter's invoicing choice reflects structural aspects of her industry, such as market share and the price-sensitivity of demand, the hedging of marginal costs, due for instance to the use of imported inputs, and macroeconomic volatility. We use a new highly disaggregated dataset to assess the roles of the various invoicing determinants. We find support for the factors identified in the literature, and document a new feature, in the form of a link between shipments size and invoicing. Specifically, larger transactions are more likely to be invoiced in the importer's currency. We offer a potential theoretical explanation for the empirical link between transaction size and invoicing by allowing invoicing to be set through a bargaining between exporters and importers, a feature that is absent from existing models despite its empirical relevance.}, url = {http://repository.graduateinstitute.ch/record/295141}, }