Purchasing Power Parity in Central and East European Countries

This paper analyzes the validity of purchasing power parity (PPP) across twelve Central and Eastern European countries (CEECs). PPP is tested through linear and nonlinear unit root tests. The results suggest that when structural changes and nonlinearities are accounted for, the PPP hypothesis is sup...

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Bibliographic Details
Published in:	Eastern European economics Vol. 47; no. 5; pp. 25 - 41
Main Authors:	Telatar, Erdinç, Hasanov, Mübariz
Format:	Journal Article
Language:	English
Published:	Abingdon Routledge 01-09-2009 M. E. Sharpe M.E. Sharpe, Inc Taylor & Francis Ltd
Series:	Eastern European Economics
Subjects:	Applied economics Economic theory Economic transitions Equilibrium exchange rates European Union Nonlinearity Null hypothesis Purchasing power parity Real exchange rates Root test Studies Transitional economies Validity Eastern Europe Central Europe
Online Access:	Get full text
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Summary:	This paper analyzes the validity of purchasing power parity (PPP) across twelve Central and Eastern European countries (CEECs). PPP is tested through linear and nonlinear unit root tests. The results suggest that when structural changes and nonlinearities are accounted for, the PPP hypothesis is supported for the CEECs.
ISSN:	0012-8775 1557-9298
DOI:	10.2753/EEE0012-8775470502