IDEAS home Printed from https://ideas.repec.org/a/taf/reroxx/v25y2012i1p4-17.html
   My bibliography  Save this article

Economic Integrations and Purchasing Power Parity Assumption

Author

Listed:
  • Josip Tica
  • Petar Sorić

Abstract

The goal of the paper is to investigate in which way economic integration and economic relations affect mean reverting properties of real exchange rates. We have employed unconstrained and constrained augmented Dickey-Fuller unit root test and Im Pesaran Shin panel unit root test in order to investigate mean reverting properties of real exchange rates in transition, ASEAN, MERCOSUR countries and China vis à vis Germany and the USA. Our analysis is interesting due to the fact that it provides evidence of the impact of (further) integration on the problems with price competitiveness in EU and EMU periphery countries. Evidence suggests that economic relations of ASEAN and MERCOSUR countries vis à vis the USA and transition countries vis à vis Germany are affecting mean reverting properties of relative exchange rates. In all three groups of countries evidence of stationarity of real exchange rates is much stronger vis à vis major economic partner.

Suggested Citation

  • Josip Tica & Petar Sorić, 2012. "Economic Integrations and Purchasing Power Parity Assumption," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 25(1), pages 4-17, January.
    • Handle: RePEc:taf:reroxx:v:25:y:2012:i:1:p:4-17
    DOI: 10.1080/1331677X.2012.11517490
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/1331677X.2012.11517490
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/1331677X.2012.11517490?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:reroxx:v:25:y:2012:i:1:p:4-17. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/rero .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.