Bargaining In International Trade Under Exchange‐Rate Uncertainty

Shabtai Donnenfeld*, Itzhak Zilcha

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


This paper examines the implications of various contracting alternatives between exporting and importing firms on the volume of international transactions. the contracts that we study are determined in a bargaining situation under exchange‐rate uncertainty. First we look at contracts which entail an ex ante commitment on price and quantity of exports without the possibility of renegotiation ex post. Second, spot contracts, i.e., the price and the quantity of exports are negotiated after the exchange the rate is known. A third type of contracts consists of ex ante commitment and ex post renegotiation.

Original languageEnglish
Pages (from-to)249-263
Number of pages15
JournalReview of International Economics
Issue number3
StatePublished - Oct 1995


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