As Korean won has gained steadily against the US dollar since 2001, the concern of exchange rate pass-through(ERPT) on export price has been spread out. The ERPT on export price shows how much the export price is influenced when exchange rate changes. This paper analyzes the ERPT on export price in Korea, Japan and Taiwan using the short dynamic model. The major results of this paper are as follows.

First, the ERPT on export price in Korea is very low compared with Japan and Taiwan. It means that Korean exporters take a pricing to market strategy and adjust a profit margin to offset changes of exchange rate. Moreover, Korea has relatively long term structure compared to other countries in regard of time difference of ERPT.

Second, the ERPT on export price in Korea rose after the financial crisis. It explains that Korean exporters considered the great fluctuation of exchange rates from 1997 to 1998 as a temporary phenomenon, so that they responded conservatively to the changes of exchange rates. However Korean exporters considered the downward trend of exchange rates since 1999 as a permanent phenomenon. Therefore, they responded positively to the changes of exchange rates. It seems that Korean exporters have taken a pricing to profit strategy comparing to a pricing to market strategy since 1999.

Third, there were also asymmetries that the direction and size of changing exchange rate affected on pass-through. Korean exporters responded asymmetrically to appreciation and depreciation. For example, the ERPT was higher in the depreciation than the appreciation. In addition, the exporters responded asymmetrically to large and small change in exchange rates. In bigger exchange rate fluctuations, they responded less sensitively than in the case of smaller exchanges rate fluctuations.