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Testing for nominal convergence in the Central American area: evidence from panel data unit-root tests

Author

Listed:
  • Jean-François Hoarau

    (CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de La Réunion)

  • Stéphane Blancard

    (CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux - ENESAD - Etablissement National d'Enseignement Supérieur Agronomique de Dijon - INRA - Institut National de la Recherche Agronomique)

  • Philippe Jean-Pierre

    (IAE La Réunion - Institut d'Administration des Entreprises - La Réunion - UR - Université de La Réunion, CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de La Réunion)

Abstract

Inflation convergence between the Central American Area and the United States is investigated using both recent homogeneous and heterogeneous panel data unit-root methods. Strong rejections of unit-root hypothesis are found, and therefore evidence of Purchasing Power Parity, in the Central American countries for the 1981:1–2005:4 period. Then by considering the nominal convergence criterion, the dollarization system seems to be suited to this region.

Suggested Citation

  • Jean-François Hoarau & Stéphane Blancard & Philippe Jean-Pierre, 2009. "Testing for nominal convergence in the Central American area: evidence from panel data unit-root tests," Post-Print hal-01243476, HAL.
    • Handle: RePEc:hal:journl:hal-01243476
    DOI: 10.1080/13504850701367148
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    References listed on IDEAS

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    Cited by:

    1. Hałka, Aleksandra & Leszczyńska-Paczesna, Agnieszka, 2019. "Price convergence in the European Union – What has changed?," Economic Modelling, Elsevier, vol. 79(C), pages 226-241.

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