Purchasing Power Parity in the Case of Romania: Evidence from Structural Breaks
Purchasing Power Parity has most likely been one of the most investigated issues of the last decades within economic literature. The results from such studies are not consistent and not only important for policy makers and economists but also extremely important for policy implications in international finance. Purchasing Power Parity states the exchange rate between two countries should reflect the relative purchasing power of these two countries. This study tests the validity of the purchasing power parity hypothesis in Romania with employing Zivot–Andrews unit root test by taking structural break into account. We use annual data from 1991 to 2012 and the results show that purchasing power parity does not hold in Romania.
Volume (Year): 3 (2013)
Issue (Month): 4 ()
Pages: 973 - 976
|Contact details of provider:|| Web page: http://www.econjournals.com|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Saadet Kasman & Adnan Kasman & Duygu Ayhan, 2010. "Testing the Purchasing Power Parity Hypothesis for the New Member and Candidate Countries of the European Union: Evidence from Lagrange Multiplier Unit Root Tests with Structural Breaks," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 46(2), pages 53-65, March.
- David Barlow, 2003. "Purchasing Power Parity in Three Transition Economies," Economic Change and Restructuring, Springer, vol. 36(3), pages 201-221, September.
- Juan Carlos Cuestas, 2007.
"Purchasing Power Parity In Central And Eastern European Countries: An Analysis Of Unit Roots And Nonlinearities,"
Working Papers. Serie AD
2007-22, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Juan Carlos Cuestas, 2009. "Purchasing power parity in Central and Eastern European countries: an analysis of unit roots and nonlinearities," Applied Economics Letters, Taylor & Francis Journals, vol. 16(1), pages 87-94.
- Minoas Koukouritakis, 2009.
"Testing the purchasing power parity: evidence from the new EU countries,"
Applied Economics Letters,
Taylor & Francis Journals, vol. 16(1), pages 39-44.
- Minoas Koukouritakis, 2007. "Testing the Purchasing Power Parity: Evidence from the New EU Countries," Working Papers 0720, University of Crete, Department of Economics.
- Dimitrios Sideris, 2006. "Purchasing Power Parity in economies in transition: evidence from Central and East European countries," Applied Financial Economics, Taylor & Francis Journals, vol. 16(1-2), pages 135-143.
- Alan M. Taylor & Mark Taylor, 2004.
"The Purchasing Power Parity Debate,"
46, University of California, Davis, Department of Economics.
- Ebru Guven Solakoglu, 2006. "Testing purchasing power parity hypothesis for transition economies," Applied Financial Economics, Taylor & Francis Journals, vol. 16(7), pages 561-568.
- Alper Aslan & Ferit Kula, 2011. "Purchasing Power Parity in Eastern European Countries: Further Evidence from Black Market Exchange Rates," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 13(29), pages 287-294, February.
- Hsu-Ling Chang & Chi-Wei Su & Meng-Nan Zhu & Pei Liu, 2011. "Re-examining long-run purchasing power parity for Central and Eastern European countries: nonlinear panel unit root tests," Applied Economics Letters, Taylor & Francis Journals, vol. 18(5), pages 411-415.
- Zivot, Eric & Andrews, Donald W K, 1992.
"Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis,"
Journal of Business & Economic Statistics,
American Statistical Association, vol. 10(3), pages 251-70, July.
- Zivot, Eric & Andrews, Donald W K, 2002. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 25-44, January.
- Eric Zivot & Donald W.K. Andrews, 1990. "Further Evidence on the Great Crash, the Oil Price Shock, and the Unit Root Hypothesis," Cowles Foundation Discussion Papers 944, Cowles Foundation for Research in Economics, Yale University.
- Tom Doan, . "ZIVOT: RATS procedure to perform Zivot-Andrews Unit Root Test," Statistical Software Components RTS00236, Boston College Department of Economics.
- Christev, Atanas & Noorbakhsh, Abbas, 2000. "Long-run purchasing power parity, prices and exchange rates in transition: The case of six Central and East European countries," Global Finance Journal, Elsevier, vol. 11(1-2), pages 87-108.
- Mark P. Taylor, 2003. "Purchasing Power Parity," Review of International Economics, Wiley Blackwell, vol. 11(3), pages 436-452, 08.
- Ali Acaravci & Ilhan Ozturk, 2010. "Testing Purchasing Power Parity in Transition Countries: Evidence from Structural Breaks," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 12(27), pages 190-198, February.
When requesting a correction, please mention this item's handle: RePEc:eco:journ1:2013-04-21. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ilhan Ozturk)
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.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.