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Cross-Border Shopping: Evidence and Welfare Implications for Switzerland

Author

Listed:
  • Ariel Burstein
  • Sarah Lein
  • Jonathan Vogel
  • Sarah Marit Lein
  • Jonathan E. Vogel

Abstract

Consumers access foreign goods by purchasing them domestically or shopping abroad. We present new facts on cross-border shopping by Swiss households showing, for example, that prices of identical products are lower in neighboring countries, cross-border shopping shares fall with distance to the border, and price gaps and cross-border shopping shares rose following the 2015 Swiss Franc appreciation. We use a simple model of cross-border shopping to quantify how variation across space in cross-border shopping results in heterogeneous changes in cost-of-living in response to changes in international prices such as the 2015 Swiss Franc Appreciation and the 2020 Covid-19-related closing of the border.

Suggested Citation

  • Ariel Burstein & Sarah Lein & Jonathan Vogel & Sarah Marit Lein & Jonathan E. Vogel, 2024. "Cross-Border Shopping: Evidence and Welfare Implications for Switzerland," CESifo Working Paper Series 11373, CESifo.
  • Handle: RePEc:ces:ceswps:_11373
    as

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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp11373.pdf
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    References listed on IDEAS

    as
    1. Jen Baggs & Eugene Beaulieu & Loretta Fung & Beverly Lapham, 2016. "Firm Dynamics in Retail Trade: The Response of Canadian Retailers to Exchange Rate Shocks," Review of International Economics, Wiley Blackwell, vol. 24(3), pages 635-666, August.
    2. Martin Brown & Matthias R. Fengler & Jonas Huwyler & Winfried Koeniger & Rafael Lalive & Robert Rohrkemper, 2023. "Monitoring consumption Switzerland: data, background, and use cases," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 159(1), pages 1-16, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    cross-border shopping; cost of living; household heterogeneity;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • F10 - International Economics - - Trade - - - General
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • F60 - International Economics - - Economic Impacts of Globalization - - - General

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