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MacKay, Alexander
Miller, Nathan H.
Remer, Marc
Sheu, Gloria
Year of Publication: 
Series/Report no.: 
EAG Discussion Paper 14-1
We show that, in general, consistent estimates of cost pass-through are not obtained from reduced-form regressions of price on cost. We derive a formal approximation for the bias that arises even under standard orthogonality conditions. We provide guidance on the conditions under which bias may frustrate inference.
Document Type: 
Working Paper

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