International trade and the role of market transparency

Arbeitspapier

The paper examines the economic role of market transparency on the decision problems of an international firm. Transparency is described in terms of the informativeness of a publicly observable signal. With higher transparency, the signal conveys more precise information about the random foreign exchange rate. We analyze the interaction between market transparency, ex ante expected production, domestic sales, and exports of the firm. Furthermore, we discuss the welfare implications of more transparency in the foreign exchange market for the firm and domestic consumers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Dresden Discussion Paper Series in Economics ; No. 08/10

Classification and Topics

• Classification: Wirtschaft ; Neoclassical Models of Trade ; Multinational Firms; International Business ; Information and Market Efficiency; Event Studies; Insider Trading ; International Financial Markets
• Subject: Blackwell theorem ; information system ; transparency ; hedging ; international trade

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Broll, Udo ; Eckwert, Bernhard ; Wong, Kit Pong
• Event: Veröffentlichung
• (who): Technische Universität Dresden, Fakultät Wirtschaftswissenschaften
• (where): Dresden
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/48162
• Last update: 10.03.2025, 11:41 AM CET