Testing long-run validity of purchasing power parity for Asian countries


Doganlar M.

APPLIED ECONOMICS LETTERS, vol.6, no.3, pp.147-151, 1999 (SSCI) identifier identifier

  • Publication Type: Article / Article
  • Volume: 6 Issue: 3
  • Publication Date: 1999
  • Doi Number: 10.1080/135048599353519
  • Journal Name: APPLIED ECONOMICS LETTERS
  • Journal Indexes: Social Sciences Citation Index (SSCI), Scopus
  • Page Numbers: pp.147-151
  • Çukurova University Affiliated: No

Abstract

This study presents an empirical analysis of purchasing power parity for five developing Asian countries, namely India, Indonesia, Pakistan, Philippines and Turkey. This is done by using cointegration technique. Time series properties of nominal exchange rate and price series show that they are nonstationary. The exchange rate and relative price series do not appear to be cointegrated for most of the countries. We reject the validity of purchasing power parity for India, Indonesia, Pakistan, Philippines, but we can accept it for Turkey.